Brookfield of Dreams

When Jensen Huang delivered his plan to mobilize $500 billion of third-party capital to fund AI infrastructure last month, one of the providers he roped in was Brookfield. To many observers, it came as a surprise. Huang and his team at Nvidia had been working with Goldman Sachs, Blackstone and Apollo for months, yet days before they shared their announcement, Brookfield, along with KKR and BlackRock, slid into the deal. Flanked by Huang at the CNBC studios, Brookfield CEO Bruce Flatt laid out his credentials: “We’ve been building out backbone infrastructure since the company started. Originally it started with enormous amounts of power – solar, wind, gas. We moved to data centers. And with Jensen, we’ve now been moving to compute.” Brookfield has interests spanning a range of assets. It manages $1.3 trillion of capital – some its own and some its customers’ – employing more than 5,800 professionals across 50 countries. This week alone, executives in its private equity business agreed to buy Australian plumbing manufacturer Reliance as colleagues in London recapitalized Center Parcs, a UK-based holiday park they bought in 2015. Closer to home, Brookfield negotiated a minority stake in American Real Estate Partners, and in Canada, where the firm has its roots, it launched an initiative to invest back in the country via a new Maple Fund. To top it off, senior management hosted an investor day at the Conrad Hotel in downtown New York – and I listened in. We discussed Brookfield back in 2022 but it’s changed a bit since then. I didn’t know it at the time, but a few years earlier Flatt had rebuffed a deal to merge Brookfield with Apollo. “We were the kings of private equity, credit, and insurance,” Apollo’s founder recalled. “They were the kings of real estate and infrastructure. You’d have a firm that would be bigger than Blackstone and more powerful.” Instead, Brookfield acquired Oaktree Capital Management to bolster its franchise in credit (“imbecilic,” says Apollo’s founder), it transitioned from a conglomerate to an asset manager, and, like several of its peers, pivoted into insurance. Apollo’s founder is unimpressed: “He’s created a second-tier private equity business. He’s created a second-tier credit operation. Now, he’s creating a second-tier insurance business.” Others in the industry are more complimentary. One of them is Bill Ackman. Through his fund, Pershing Square, Ackman owns a $2.5 billion stake in Brookfield Corporation. “Brookfield is a high-quality, asset-rich, rapidly growing business that has a long-term track record of excellent capital allocation,” he writes in his annual letter. In particular, Ackman reckons Brookfield is poised to benefit from the multi-trillion-dollar wave of AI-related infrastructure investment. Flatt has lofty ambitions for Brookfield. He has already doubled the firm’s assets under management over five years and reckons he can do it again over the next five. “Our evolution has been about adapting our structure as the opportunity set evolves,” he reveals. To explore what that means – how Brookfield went from industrial owner to asset manager and insurer, and whether its evolving structure creates value or merely obscures it – read on.