Ares Management's Expansion into Australian Private Infrastructure Markets

In a global investment landscape defined by persistent inflation and historically low yields, private infrastructure has emerged as a compelling asset class for institutional investors. Australia, with its maturing infrastructure market and structural growth drivers, has become a focal point for firms like Ares Management, which is leveraging its expertise in private capital to capitalize on this shift.

Strategic Expansion: Ares and the RSK Consortium

Ares Management Australia has positioned itself at the forefront of the country’s infrastructure renaissance through its participation in the RSK Group consortium. In 2024, the firm contributed £500 million to a £520 million preferred equity investment aimed at accelerating RSK’s global growth strategy [1]. This move aligns with broader trends in Asia-Pacific private equity, where deal values rose 11% year-over-year in 2024, driven by a surge in buyout activity as investors seek greater control and risk mitigation [1]. RSK’s acquisition of Australian firms like Edge Impact and Kendall Kingscott underscores its focus on sustainable infrastructure, a sector poised to benefit from Australia’s energy transition and digitalization demands [1].

The RSK consortium’s strategy reflects a broader shift in private infrastructure investing: a focus on value creation through organic growth and acquisition synergies. As Ares and its partners integrate these assets, they are tapping into Australia’s deepening pipeline of public and private capital commitments, particularly in transport and renewable energy [2].

Private Infrastructure as a Diversifier

Australia’s inflation rate, which stood at 2.1% year-over-year in Q3 2025, has created a fertile environment for infrastructure investments [3]. While headline inflation has moderated, structural pressures—such as rising electricity costs and the energy transition—highlight the need for assets that offer inflation linkage and stable cash flows. Private infrastructure, with its long-term contracts and automatic pricing escalators tied to inflation, provides a natural hedge against macroeconomic volatility [4].

Data from the MSCI Australia Quarterly Private Infrastructure Index illustrates this resilience: unlisted infrastructure delivered a 12.2% annual return to June 2025, outperforming traditional asset classes on a risk-adjusted basis [2]. This performance is underpinned by infrastructure’s low correlation with equities—during Q1 2025, infrastructure outperformed the S&P 500 by 660 basis points, reinforcing its appeal as a defensive asset [4].

Macroeconomic Tailwinds and Structural Growth

The Australian infrastructure market is further bolstered by structural growth drivers. The energy transition, for instance, is fueling demand for renewable projects and grid modernization, while AI-driven digitalization is spurring investment in data centers [5]. These trends align with Ares’ focus on sectors with long-term secular growth, such as RSK’s sustainable infrastructure capabilities.

Meanwhile, the low-yield environment has made private infrastructure increasingly attractive. With Australian government bond yields near historic lows, investors are turning to assets that offer both income and capital appreciation. Infrastructure’s predictable cash flows, supported by regulatory frameworks and long-term contracts, fill this gap [1].

Conclusion

Ares Management’s expansion into Australia’s private infrastructure market is a calculated response to a shifting macroeconomic landscape. By anchoring its strategy in sectors with inflation linkage, structural growth, and diversification benefits, the firm is positioning itself to capitalize on Australia’s infrastructure renaissance. As global investors grapple with the dual challenges of inflation and low yields, the case for private infrastructure—as exemplified by Ares’ RSK partnership—has never been stronger.

Source:
[1] Asia-Pacific Private Equity Report 2025 [https://www.bain.com/insights/asia-pacific-private-equity-report-2025/]
[2] Infrastructure Outlook Q3 2025: Resilience and Opportunity [https://www.dexus.com/news-insights/insights/infrastructure-outlook-q3-2025-resilience-and-opportunity.html]
[3] Australia Inflation Rate [https://tradingeconomics.com/australia/inflation-cpi]
[4] Why Infrastructure is Powering Ahead | iShares - BlackRock [https://www.blackrock.com/au/insights/ishares/why-infrastructure-is-powering-ahead]
[5] Global Listed Infrastructure Fund – Quarterly Update – Q2 2025 [https://www.firstsentierinvestors.com/at/en/professional-investor/insights/glis-quarterly-update-Q2-2025.html]