Border to Coast, one of the eight Local Government Pension Scheme (LGPS) pools, has launched two new real estate funds that have initial commitments of £870m.
Border to Coast expects both funds to grow to over £1bn. Photo: Shutterstock
The two funds, ‘Global Core’ and ‘Global Value-Add’, have initial investments of £500m and £370m respectively, with further combined commitments expected to be over £1bn.
Joe McDonnell, chief investment officer at Border to Coast, said: “With the launch of these funds, Border to Coast can offer our partner funds investment opportunities across the suite of typical pension scheme asset classes.
“These two global real estate funds provide partner funds with the flexibility to set a bespoke risk-adjusted return profile for global real estate and invest accordingly.”
The pool, which manages £40.3bn of assets, said that the Global Core fund will provide its 11 partner funds with exposure to real estate investments seeking a mainly income-driven return profile. The initial phase of the fund will involve transferring legacy allocations from participating partner funds, which is expected to take two years. After this, it will be open to annual subscriptions from all partner funds.
Whereas, the Global Value-Add fund will seek a mainly capital appreciation return, enabling funds to seek additional returns to provide diversification to their existing portfolio of growth assets. It has an initial three-year investment period with commitments to investee funds.
A Border to Coast UK real estate proposition is currently under development with a target launch date of 2024.
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