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Is Brookfield Biting Off More Than it Can Chew?

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According to data from the Sovereign Wealth Fund Institute (SWFI), increasingly asset owners such as sovereign wealth funds and large pensions have augmented allocation to unlisted infrastructure. The money flows have created bubbles in the world of private infrastructure, forcing asset owners, managers and other investors to pay more for infrastructure assets. Toronto-based Brookfield Asset Management, within a nine-month span, raised the biggest private infrastructure fund in history – closing US$ 14 billion in equity commitments for Brookfield Infrastructure Fund III. The original fundraising target was US$ 10 billion. Brookfield Infrastructure Fund III, which targets core infrastructure assets on a value basis, has a four-year investment period that will last 12 years – subject to annual extensions. To be fair, US$ 4 billion of that amount is being committed by Brookfield Infrastructure Partners L.P. and Brookfield Renewable Partners L.P. However, US$ 6.2 billion was committed from 77 new investors, which include fresh backers from China, Japan and South Korea, out of 120 investors. Asian investors such as Korean pensions are eager to push capital toward single-digit generating illiquid infrastructure assets. Even so, the surging demand for investments outside the volatile world of listed equities and negative interest rates in government bonds have created substantial demand for real assets.

That limited partner money would be at substantial political risk, as Brazil is undergoing a tumultuous period of exposed corruption.

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Senate Shoots Down $94 Trillion Green New Deal, 57 to 0

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The U.S. Senate voted down U.S. Representative Alexandria Ocasio-Cortez’s Green New Deal. The tally was 57 (No) to 0 (Yes). 0 Democrats voted for the deal. 43 senators voted present.

Democratic Senators Joe Manchin of West Virginia; Kyrsten Sinema of Arizona; and Doug Jones of Alabama all voted no as did Independent Senator Angus King.

Even Senator Ed Markey of Massachusetts, a co-sponsor of the original resolution, did not vote “Yes” on the bill.

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OppenheimerFunds to Lose 850 Jobs in Mile High City

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Invesco Management Company, upcoming owner of OppenheimerFunds, is reducing Oppenheimer’s Denver office by a jaw-dropping 850 employees. The employees losing their jobs represents 85% of the staff in the area. The Oppenheimer office, which resides in Centennial, employs 1,000 workers. Invesco’s US$ 5.4 billion purchase of the company closes in May 2019. As is typically the case in corporate acquisitions, redundancies in staff are being targeted to improve the overall economic performance of the new, combined organization. Invesco suspects that US$ 475 million in synergies can be reached through layoffs and other measures.[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Keppel Land China and Alpha Investment Partners Acquire Majority Stake in Yi Fang Tower

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Alpha Asia Macro Trends Fund III, Keppel Land China Limited (part of the Keppel Corporation), and a number of investors purchased the Yi Fang Tower mixed-use complex for 4.6 billion RMB. The tower is located in Shanghai in the historic Bund area. Alpha Asia Macro Trends Fund III is taking 42.1% stake, while Keppel Land is taking a 29.8% stake in the asset. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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