Global investors zero in on Middle East infrastructure as financing needs swell

What happened at Bloomberg Invest Dubai

Blackstone and PIMCO executives used the Bloomberg Invest Dubai stage to sketch out a growing investment runway across the Gulf. Farhad Karim, Global Chief Operating Officer of Blackstone Private Wealth, said the firm's capital deployment in the region during the past year reached a record high, and summed it up plainly: "The opportunity set is extraordinary."

Karim pointed to data infrastructure and logistics, along with other physical assets, as areas needing capital. He added a simple field test for demand: "I mean, just driving around Dubai, it's incredible what you see that needs capital." That stance has shown up in deals despite the Iran war, including a tie-up with a Dubai partner to launch an aircraft-leasing business and a $250 million investment in a payments infrastructure platform based in Abu Dhabi.

Christian Stracke, Managing Director and President at PIMCO, said financing prospects span digital infrastructure and transport. Karim and Stracke joined Bloomberg's Abeer Abu Omar for a 25:04 discussion on geopolitics, capital deployment, and how the wealth landscape is evolving.

Government plans and the financing gap

The broader push comes as regional governments open more projects to outside investors. UAE Investment Minister Mohamed Hassan Alsuwaidi said the country expects more energy, industrial and infrastructure projects to welcome third party capital. The UAE hosts sovereign investors that oversee in excess of $2 trillion, and while capital is abundant, the goal is to bring more private investors into projects previously financed by the state.

Alsuwaidi said opportunities are emerging in artificial intelligence and robotics, plus logistics, financial services and real estate. He noted shortages in parts of the property market, especially offices and warehouses. He also put returns in investor terms: "If you can make a long term, high single or low double for the long term with high certainty, I'd take that any day."

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The UAE plans to increase port capacity along its eastern coastline, including at Fujairah and outside the Strait of Hormuz, with projects carrying multibillion-dollar price tags. The scale of funding needs is underscored by First Abu Dhabi Bank PJSC's plan for the country's largest rights issue, aiming to raise up to 15 billion dirhams, or $4.1 billion, to help support infrastructure expansion.

Risk, routes and what it means for your portfolio

Months of war involving Iran have highlighted how dependent the Gulf is on the Strait of Hormuz, as well as how fragile its shipping and energy assets can be, adding urgency to alternative routes and facilities. That backdrop has lifted risk premiums for projects and pushed governments to show returns that justify those risks, especially while the global cost of capital stays higher. PIMCO's Stracke noted that the region's "massive" capex requirements surpass what local banks and conventional government-linked financing can provide, opening space for private investors. According to Alsuwaidi, the UAE's strong credit standing is an advantage.

In plain English: deal flow is expanding across digital infrastructure, transport, energy and AI, and governments are inviting external investors into the mix. The bottom line for portfolios is a pipeline of sizable, structured opportunities, paired with higher required returns to account for elevated risk and pricier capital.

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