Nippon Life has backed Allianz Global Investors’ new UK infrastructure debt fund.

The Japanese insurer, an Allianz shareholder since 2011, said it had committed £57m to the new fund.

The fund will raise up to £500m for long-term core UK infrastructure.

The decision to launch the fund for small and mid-sized pension funds follows “strong demand” from large institutional investors for separately managed accounts.

The new fund will run alongside the accounts, Allianz said, investing in roads, schools, hospitals, water and energy assets. 

Deborah Zurkow, Allianz Global Investors chief investment officer for infrastructure debt, said the fund would “allow the broadest possible church of institutional investors” access to long-term, stable cash flows.

“As this new market continues to develop and mature we expect to see significantly more institutional investor interest,” Zurkow added.

Allianz has launched the fund 18 months after creating an infrastructure debt team. The firm said it had invested €2bn on behalf of clients in eight infrastructure debt transactions across seven European countries.

Earlier this year, the Telent pension fund committed to Allianz’s listed project bonds platform, becoming the first UK scheme to do so and investing in Scottish roads.

Infrastructure investment has long been touted as a natural step for pension funds faced with long-term liabilities.

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