Essex Pension Fund has appointed Alcentra as a manager for an illiquid real estate debt strategy.

The Bank of New York Mellon subsidiary is now tasked with investing between £80m (€101.3m) and £100m in a pooled illiquid debt fund.

The allocation accounts for around 2% of the pension fund’s overall assets under management.

The long-only debt portfolio will include direct corporate lending, real estate lending and distressed debt.

Essex, advised by Hymans Robertson, began the search for a manager in the first quarter of this year.

Managers with high leverage funds were excluded. 

The fund said it only considered managers with the required credentials and track record – including sourcing, origination capabilities and work-out expertise.

A shortlist was drawn up in July, with the decision to appoint Alcentra filed on the European Union tender website this week.

Alcentra specialises in sub-investment-grade corporate debt, from secured loans and high-yield bonds to direct lending, mezzanine, special situations and structured credit.