Hydralis has decided to create an allocation of around €70m to unlisted assets, including real estate and infrastructure.
The €731m Belgian pension fund is looking to invest in equity or debt.
The allocation is intended to replace “certain existing securities with a view to reducing volatility given the decorrelation generated by these assets”, it said in a tender document.
The earnings target, net of management fees, is 4.5%-7% per year, taking into account the contract’s maximum term of eight years.
Hydralis said it “attaches particular importance” to achieving the minimum return target of 4.5% per year and therefore opted for a multi-asset solution.
It is looking to invest via funds. It would be up to the asset manager to define the strategic asset allocation.
Hydralis is responsible for managing the statutory pensions of Vivaqua, a Belgian intermunicipal water utility.