“In the Netherlands, large investors will need to invest more in infrastructure”

Published on: 16 August 2022

553 billion euros. That is APG’s total invested assets worldwide (position as of the end of June 2022). The goal: a good pension in a livable world for the funds’ participants. The portfolio is diversified, of course. From investments in wind farms in Zeeland to Australian listed shares in stores. And from safe bonds to the somewhat more fluctuating trade in gold or soy. Who are the people behind these investments? What drives them? What choices do they make? And why?

In this episode of the series The Investors: Jan-Willem Ruisbroek, head of investment strategy infrastructure at APG.

Ruisbroek has every reason to be a happy man. APG was recently voted Real Assets & Infrastructure Investor of the Year at the IPE Real Estate Awards 2022 in Amsterdam. For the second year in a row. APG is “once again demonstrating strong leadership in the global infrastructure investment strategy,” according to the jury report. According to the jury, while other large infrastructure investors boast of investing in the energy transition, for example, APG looks further and also invests in digital infrastructure. “This award shows that our strategy is considered sound and distinctive. It is a nice compliment for what we do”, says Ruisbroek.

According to the jury’s report, APG looks further ahead than many other large infrastructure investors. Still, there will be a lot of gains to be made in the infrastructure field. In what area is there work for you?

“In the Netherlands, institutional investors, including us, will have to invest more equity in infrastructure. Large investors abroad often invest more than 20 percent of their assets in infrastructure, but this is much less for Dutch investors. The extra money is badly needed. For example, the International Energy Agency estimates that more than 4 trillion dollars, that's 12 zeros, are needed annually to achieve a so-called net-zero society worldwide. That is, total global greenhouse gas emissions are less than or equal to those removed from the atmosphere. That 4 trillion must flow primarily to new infrastructure projects such as power grids and renewable energy sources.”


APG’s infrastructure investment strategy is based on five so-called megatrends. One is geopolitical: for example, take a more assertive stance on China. That country invests enormous amounts in infrastructure projects in developing countries. What if China starts using its enormous financial clout in the Western world as well?

“That is already happening. In recent decades China has also invested a lot in Europe. In recent years this has become less common, because governments want to keep their vital infrastructure in the hands of parties ‘close to home’. In general, local pension funds are happy owners of infrastructure, because of their long-term interests and social involvement.”


You started at ABP/APG immediately after you finished your education and haven’t left since. Didn’t you miss out on some opportunities as a result?

“I graduated at a good time because there was a lot of work for students, just like now. There were a number of parties interested in me but I immediately had a very good connection with the man who would later become my first boss at ABP. He said, ‘I like you and want you, here’s an offer.’ At the time, I was also charmed by everything I saw at ABP, like the size and the impact. We have everything here, pretty much all the investment markets. That’s important when you start working, because you have a lot of choices. I remember saying during my job interview that anyone who is 24 and says they know exactly what they want is bluffing. Because when you are just out of school, you don’t know exactly what you want. Personally, I wanted to work for a really cool employer more than anything and take my time poking around there, finding out what made me the happiest. And that’s how it went.”


You’ve been focusing entirely on infrastructure since 2008. What makes investing in it so interesting to you?

“The type of companies we invest in are interesting to me, above all, because of the essential role they play in society. When people plug something electrical into a wall socket, they often don’t realize the enormous infrastructure behind it. That is, until there is no power for a while. The social importance of companies that provide people with an essential commodity, such as electricity, data or mobility, also greatly appeals to me. Just like the essential role that all these companies play in the major social issues of our time, such as the energy transition and the digitalization of the world. We will only be able to achieve energy transition if the infrastructure for it is in place. What also attracts me is that we invest in private companies. In private companies you are often closer to the company and you can think more actively about the strategy and what you want to achieve with such a company than with listed companies.”


One of the ways to influence private companies is to take a seat on a non-executive board. You do that regularly. How do you wield that influence in practice?

“I am on the supervisory board of two companies that we invest in, which means that I supervise the management. The companies we invest in are often smaller than the listed companies, of which you might buy a small pick of shares. We regularly have a large stake in the private companies we invest in, which gives us the right to appoint a commissioner. In our team we have something like twenty or thirty supervisory directorships. That takes up quite a lot of time. As a supervisory director you are involved in assessing and approving the business plan and the long-term strategy, but you also have to contribute to the deliberations on the management's appointment policy.”

The best companies see sustainability as an opportunity rather than a cost

Developments in the world of infrastructure follow each other in rapid succession. How does your team find out where the interesting new projects are to invest in?

“You really only find out by being active in the market and networking a lot, because there is no central place where shares are traded. If you want to invest in a French wind farm, for example, you just need to know that shares are for sale. So, our work largely consists of calling people, meeting people and traveling to projects we invest in. Advisors from investment banks also visit us regularly. They know where interesting transactions can be expected and where money can be made. And we do make money, because our infrastructure portfolio has done well since 2006. In the sixteen years of our existence, we have achieved an average return of about 9 percent per year. That’s not bad.”


Sustainability is important, including to APG. Doesn’t focusing on it come at the expense of returns?

“Focusing on sustainability certainly does not have to come at the expense of returns. In fact, the best companies see sustainability as an opportunity rather than a cost. We are seeing that the best management teams of the companies we invest in have the courage to roll up their sleeves and actively look for business cases around sustainability. And that is exactly what we are looking for and also achieving in our companies. We may also invest in a less sustainable company, such as a port. But we only do that if we can make its business operations more sustainable. For example, generating green energy by installing windmills there. Or making the port part of the supply chain of sustainable products. As an investor you can also ensure that the port makes land available for the import and export of hydrogen. Ports are also increasingly profiling themselves as maintenance centers for offshore wind farms. In short, there are plenty of opportunities to make an infrastructure project sustainable.”


APG also invests in toll roads. What kind of influence can you exert to ensure that a toll road becomes more sustainable?

“One way is to install charging stations for electric cars, install solar panels at gas stations and make sure people travel more spread out over the day. This reduces the chance of traffic jams and therefore also the pollution.”

You and your team invest in a variety of projects worldwide. Which infrastructure project do you really jump out of bed for?

“A good example is the investment we announced a few months ago on behalf of our pension fund client ABP in the Dutch company Groendus. It’s a somewhat smaller acquisition than we normally do, but we see great growth potential in it. What Groendus does is look at energy supply for companies in a different way. Instead of just offering an electricity connection, meter, solar panels or charging station as individual products, for example, they provide an integrated energy product. In effect, it is saying to these companies: ‘You get one product and we take care of the solar panels, car charging stations, smart meters and batteries. In addition, we connect you to a digital platform where energy surpluses can be traded with companies in the area.’ My heart beats faster for such a project because it is the next phase that we are all entering in the energy transition.


What I also think is important to mention is that a toll road may not be the sexiest enterprise from the outside. But if you look closely at the strategy of such a company, they are going to play a central role in the new mobility. For example, they will ensure that you can drive electrically by installing sufficient charging points along the toll road. They also want to contribute to a smooth journey by, for example, ensuring that you do not have to stop at a toll booth and by sharing information about how busy it is on the road. But also by offering other forms of transport that are more suitable for getting from the toll road into the city. For example, getting out of your car at a parking lot on the outskirts of town and traveling on a scooter. Toll roads are therefore part of a larger mobility issue and that is why I love these projects.”

Who is Jan-Willem Ruisbroek?

Earned a Bachelor of International Business at the Maastricht University and a Masters at Financial Economics at the Erasmus University in Rotterdam. Started working at ABP in 2006 and worked on an online Masters in Infrastructure Engineering at Monash University alongside his work.

“That master’s degree comes under civil engineering. I did that to educate myself a bit on the technical aspects of infrastructure. During that study, I think I was in my late twenties, I was sitting by the side of the road with a clicker for a study assignment, counting traffic to understand traffic patterns. People sometimes ask what on earth that has to do with the financial sector. I explain that investing in infrastructure is work that brings together technical knowledge of the infrastructure project, such as a toll road, and the financial aspects of such a project.”

Has a total value of 24 billion. APG’s infrastructure team consists of 40 employees. Half are in Amsterdam and the other half are spread across the offices in New York and Hong Kong. As head of investment strategy, Ruisbroek is responsible for all infrastructure investments.

Average of 9 percent per year since 2006, the year that ABP/APG got an investment team that is fully focused on infrastructure.