The Pensions Infrastructure Platform (PiP) has launched the PiP Multi-Strategy Infrastructure Fund with a target size of GBP1 billion.
The Fund will invest directly in UK infrastructure and aims to provide institutional investors with a degree of alignment and transparency, which the firm believes, is not available elsewhere in the market today.
The Fund will also offer a co-investment programme for larger investors to allow them to achieve even further benefits of scale. In order for smaller pension schemes to participate, the Fund will have a minimum commitment size that effectively allows schemes of any size to invest and still share the same terms with all other investors. This aligns the Fund with one of PiP’s core principles of being open to all pension schemes, regardless of size or ultimate sponsor.
The Fund will focus on core UK infrastructure, targeting transportation; (renewable) energy; utilities; communications; housing; and social infrastructure, and have a long-term buy-and-hold investment strategy to generate low risk, inflation-linked cash flows. Investors can achieve their preferred investment exposure through the co-investment programme and the Fund’s sub-portfolios, which have different risk/return characteristics.
Mike Weston, Chief Executive, PiP, said: “The launch of the Fund is further proof that investors believe that PiP works and is delivering on its promise. With the support of our Founding Investors we’ve already mobilised GBP1 billion for investment into UK infrastructure and with this Fund we are achieving our key objective of providing pension schemes of all sizes with an efficient route to direct ownership of infrastructure assets.
“We are a true long-term investor and this is reflected in the way we build our relationships with both our investors and developers – allowing us to secure the long-term, low-risk, inflation-linked cash flows that pension schemes need. And because we’re backed by pension schemes and understand their needs, we have been set up and structured to meet these needs in the best possible way.”
Alan Rubenstein, Chief Executive, Pension Protection Fund, Founding Investor, commented: “Pension funds have long been attracted by the long-term, low-risk, inflation-linked cash flows that infrastructure can offer. PiP provides an opportunity to invest in a way specifically designed for pension funds, and being effectively owned by its investors’ means success will be shared success.”
Bailie Philip Braat, Chair, Strathclyde Pension Fund, Founding Investor, commented: "Infrastructure projects are attractive for Strathclyde as long-term, low-risk investments – and our members are also positive about seeing their savings supporting jobs and communities. However, until PiP was established, the market was really geared towards short-term investors. We have more control now, so we have access to opportunities that are tailored to the specific needs of a pension fund.”
Geik Drever, Strategic Director of Pensions, West Midlands Pension Fund, Founding Investor, commented: “There’s a huge opportunity in UK infrastructure at the moment. We helped establish PiP because we believe there’s room in the market for a transparent platform where pension funds can invest together at scale to make the most of this opportunity. The PiP Multi-Strategy Infrastructure Fund opens the door to this opportunity for pension funds of all sizes.”
Chris Hitchen, Chief Executive, RPMI Railpen, Founding Investor, commented: “We helped establish PiP because we share its vision of providing pension funds with access to great infrastructure investment opportunities tailored to their requirements. It’s designed to give schemes more influence and control as investors in infrastructure than has traditionally been the case and puts the pension funds back in control.”
AlphaQ interviewed Michael Weston, chief executive of PiP in the August edition. You can read that interview here.