This study investigates the influence of term limits on local mayors’ investment decisions and the effects on local markets and consumer welfare. I develop a model where mayors aim to optimize the spatial distribution of capital investments to maximize a weighted sum of location-specific consumer surplus over two periods. I estimate a model leveraging data from infrastructure projects in Peru alongside survey and census information pertaining to the water utility sector in small urban and rural areas as well as a natural experiment. My difference-in-difference results suggest that mayors preferred more proximate capital investments after reelection to consecutive terms was eliminated; specifically, the proportion of projects constructed within 1 km of the mayor's residence nearly doubled. This shift in resource allocation benefited households in these areas, evidenced by a 20 pp reduction in the share receiving untreated water. There was also a 10 pp increase in the percentage of families connected to the water network and an 15\% increase in water expenditure. In model simulations, I find that this resource reallocation also enhanced investment returns, with an average 1.5 pp annualized increase in the internal rate of return on investments after consecutive terms were abolished.