In 2020, as the Covid-19 pandemic fundamentally changed the way in which we live, work and communicate, our reliance on data accelerated. The pandemic condensed years of change into a few short months. And much of that change is here to stay.
At Primevest Capital Partners we identified the need for investment in this vital infrastructure and launched our first fund in 2017. First-mover advantage allowed us to build an in-house team of industry experts and become an essential interface between investors on the one hand and municipalities and operators on the other. We help both sides to understand each other. Our knowledge of these assets enables us to optimise the return for our investors. It is an exciting place to be, unlocking the potential that these assets offer while enabling connectivity and the advancement of cities.
Our approach allows investors to access a stable asset portfolio with a low risk/return profile. Attractive returns are generated in three ways: first, direct yields from regular rental payments; second, leases include automatic year-on-year inflation (CPI) adjustments; third, capital gains are created from the enhancements we make to the assets or increased utilisation rate of the network.
Our ownership opens up these assets to multiple operators, allowing for greater consumer choice, improved usage, and higher rental levels. To reduce risk, we limit investor exposure to technology by not investing in the underlying operators, although we have developed strong relationships with many, such as T-Mobile, Vodafone and many regional telecom operators. These partnerships mean we can present ready-made solutions to municipalities as they seek to improve their connectivity.
Investment Criteria
We are selective as to the assets we invest in. All of which are focused on improving consumer and business access to fixed and mobile broadband and include:
- Fixed-line fibre infrastructure: Our investments allow for expanded capacity through the installation of high-speed fibre-optic cabling, which we lease to multiple operators
- Mobile communication and broadcasting towers: Can be shared by operators, thereby increasing usage through site pooling
- Communication nodes (data centres), where we mainly invest in the shared infrastructure needed to keep them operational
Geographically we are mainly focused on urban areas with sufficient population density and solid commercial locations which are underserved by telecommunication infrastructure in Germany, Austria, the Netherlands and Belgium. For example, Germany, Europe’s largest economy, lags many other countries when it comes to fifth-generation high-speed internet provision and it is estimated that around €80 billion is required to modernise its fixed-line fibre cabling.
For more information about Smart Cities, please visit our Smart City Nederland website (in Dutch only).
