Vast Amounts of Private Money Are Seeking Toll Road Investments

With all these factors favoring toll road deals, it is no surprise that private investors have been trying to take advantage of the profit opportunities. Private infrastructure investment funds raised $25 billion in 2008, up tenfold from just $2.4 billion in 2004 (though down from the peak investment of $34 billion in 2007).42 A total of 77 such funds were active in the market at the end of 2008, seeking $92 billion in capital. 43

The recent financial crisis has caused investment in private infrastructure funds to dry up, and has eroded the stock prices of many funds. Yet, some fund managers believe that the financial crisis will be a boon to infrastructure investment in the long term. As Matthew Vickerstaff, the global head of infrastructure and as-set based finance at Societe General in New York, explained in BNET Financial Services, "The current crisis is good for infrastructure funding because there will be increasing pressure on states, cities and provinces to balance their budgets. They will need to spend both for social and transportation infrastructure. They'll need private money and private-public part-nerships."44 Thus, the number of private road deals may increase as state and local governments become more desperate for short-term infusions of cash.