Self-managed superannuation funds (SMSFs) could have a big future in infrastructure investment, but currently a large proportion are "locked out" by a closed and illiquid market, an industry body believes.
Speaking at the International Symposium for Next Generation Infrastructure, Gordon Noble, a director at the Association of Superannuation Funds Australia (ASFA), said opportunities continue to be missed because of poor planning or short-sightedness.
Noble said superannuation funds had a long, often unrecognised, history of infrastructure investment, which has been held back by illiquidity.
"As the size of the superannuation pool grows, the search for liquidity and diversification will drive superannuation funds to increase their exposure to international equity markets," he said.
Another challenge he pointed to was the fact a third of SMSFs were "effectively locked out of investment in infrastructure".
"There are opportunities to either establish infrastructure bonds or commercial products that provide a diversification of projects," he said.
Noble said ASFA would also like to see a pipeline of infrastructure projects and wants to open a dialogue with the Government about future infrastructure guarantees, particularly on small-scale investments.
