CalSTRS, APG create energy infrastructure consortium

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CalSTRS and APG have set up a consortium to invest in North American energy infrastructure, it is understood.

The asset manager owned by Dutch pension fund ABP would not “confirm nor deny” media reports that it is investing alongside The California State Teachers’ Retirement System.

CalSTRS confirmed to IP Real Estate that it had joined a “large institutional investor” in the venture.

The consortium is open to additional commitments from third-party institutional investors.

The two investors will each invest $250m (€230m) in the consortium, which will be run by investment manager Argo Infrastructure Partners.

CalSTRS said the alliance is an opportunity to build a “more diverse portfolio of investments in North America than they would have otherwise been able to make on their own”.

ABP has a €30bn stake in energy and energy infrastructure, alongside €1bn invested in sustainable energy, including onshore windfarms.

Spokesman Harmen Geers recently said ABP wanted to double its share in renewable energy to €2bn.

“Finding the right investments is not easy, as the investment must be at least €100m, and our investment criteria prevent us from owning more than 50% of any project,” Geers said last month.

APG last year invested in European energy, putting €250m into a European hydropower venture with alternative investments manager, Aquila Capital.

The new consortium will invest in core operating energy assets, including pipelines, storage facilities and power utilities.

CalSTRS said it will target facilities with existing cash flows that will need ongoing maintenance and future expansion capital.

Former JP Morgan Chase infrastructure chief investment officer, Jason Zibarras, recently created Argo, which will invest in low-risk assets in Canada and the US.

CalSTRS established its infrastructure portfolio in 2010 to diversify away from equities following the financial crisis. The pension fund, as of the end of last year, had $1.3bn committed to infrastructure globally.

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