Merseyside’s local government pension scheme is looking to allocate a further 2 percentage points to infrastructure investment and join the Greater Manchester Pension Fund (GMPF), London Pension Fund Authority (LPFA) and Lancashire Pension Fund in their GLIL pool.
In a Wirral Council update to be presented tomorrow, Merseyside, which has a 5% allocation to infrastructure, said an “increase in its allocation to infrastructure is anticipated” as part a recent review of its asset allocation. A final decision on the allocation is more likely next year, IPE Real Estate understands.
A report brought to Merseyside’s committee in September set out the background to its intention to join GLIL, the £500m infrastructure investment joint venture set up in early 2015 by the GMPF and the LPFA.
West Yorkshire Pension Fund is also joining GLIL, Merseyside said.
Infrastructure investments will only be made if officers are satisfied they meet the fund’s risk and investment return requirements, it added.
“Direct and co-investments bring greater idiosyncratic risk,” Merseyside said, “but this can be controlled with suitable advice and expert operational management of the assets.”
As previously reported, GLIL is being expanded to £1bn to include investment from the Northern Pool and Local Pensions Partnership (LPP).
It is also planned to open the joint venture to other local government pension funds.
The £35bn Northern Pool – previously known as the Northern Powerhouse Pool and backed by Merseyside as well as the GMPF and West Yorkshire – has a longer-term allocation of 15% to infrastructure.
Separately, the LPP has this year pooled £1.2bn of existing core real estate allocations from the LPFA and Lancashire County Pensions Fund (LCPF), which hold £300m and £550m in the pool, respectively.
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