Building on John Dickerson’s previous acquisitions experience with his local water utility, in 2008 Summit Water launched the world’s first private equity fund focused on building a diversified portfolio of water rights and related infrastructure assets. The timing of this launch was chosen to take advantage of the U.S. housing market crisis, as many of these water assets had been accumulated by developers over the previous decade to support booming construction in the arid U.S. southwest. When the crisis hit, many of these same developers were forced to liquidate everything not essential to their immediate survival, and Summit Water was able to enter the market to secure large amounts of water assets at distressed pricing.
In total, Summit Water raised more than $250 million to invest in water assets throughout the U.S. southwest as well as southeastern Australia, building a substantial presence in the world’s two most advanced, stable water markets. In addition to the accumulation of “wet” water rights, Summit Water has developed a portfolio of complementary infrastructure assets including reservoir storage and groundwater recharge capacity. Absent another market catalyst similar to 2008, we continue to evaluate water rights acquisitions on an opportunistic basis where the risk/reward characteristics work in our investors’ favor.
Beyond “wet” water assets, Summit Water is currently building a portfolio of water infrastructure assets to address the emergence of unprecedented opportunities for private investment given mounting water spending needs and the inability of traditional financing sources to fund them. We believe the water space is in a similar positon to the energy industry more than a decade ago, where rising prices coupled with technical advancement encouraged a seismic shift away from big, centralized production facilities toward distributed-scale alternative energy projects. Given the growing cost of securing water resources as the result of population growth, climate change, and groundwater overdraft, local water end-users are similarly reducing their dependence on centralized water storage, distribution, and treatment networks in favor of localized solutions that address their specific needs. This situation is stimulating the rapid development of decentralized water remediation, reuse, and recycling “micro utilities”, and Summit Water has positioned itself at the forefront of this trend.
It has been said that water flows downhill toward money, and Summit Water has seen its initial opportunity set emerge at the nexus of water, energy, and agriculture, where the inextricable link between these resources, coupled with intensifying costs and scarcity, have encouraged the most urgent adoption of new infrastructure solutions. We are presently developing and investing in projects in the areas of desalinization, groundwater remediation, wastewater-to-value, hydropower, and oilfield water management, and are evaluating several other verticals.
Summit Water’s goal is to deliver long-term, income-oriented returns to investors by aggregating complementary project finance opportunities into institutional-grade investment vehicles that spread risks over multiple projects in multiple verticals and multiple geographies while providing the scale to deploy large-scale investment. We invite you to email us with specific inquiries on available projects, or with project finance opportunities in the above-mentioned areas of focus.