Norwegian municipal pensions giant KLP has committed up to €100m, alongside other institutional investors, in the first closing of Catella Elithis Energy Positive Fund (CEEPF).

Managed by Berlin-based Catella Residential Investment Management (CRIM), CEEPF is the world’s first real estate investment vehicle to focus exclusively on residential developments that produce more energy from renewable sources than is consumed by the buildings and their tenants.

The impact fund is targeting a total asset volume of €500m to invest in these pioneering ‘energy positive’ residential towers, and sites have already been agreed with local authorities for the French cities of Mulhouse, Brest, Le Havre, Nancy and Bordeaux.

Michael Fink, managing director, CRIM, said: “We are delighted to welcome KLP and other institutional Investors who have joined us on our mission to lead the sustainable transformation of our cities. We have high expectations for our Elithis towers, which we are developing in partnership with French sustainable building engineering and real estate developer Elithis Groupe.

”These towers outperform the EU’s 2050 net carbon zero target operationally by using bioclimatic design and technologies which render them energy positive from the start and they can be built at standard market construction costs. We can offer with CEEPF, a viable ESG investment solution for two of the greatest crises of our times – climate change and widening social inequality – as households increasingly come up against pressure from the soaring cost of living, particularly in residential rents and high energy prices.”

The residents of the Elithis residential towers can benefit from a substantial reduction or complete elimination of their household energy bills, which makes apartment rents more affordable than comparable homes in the neighbourhood – around 5% to 10% lower on average.

Andreas L Farberg, investment manager of global real estate at KLP, said: “We see CEEPF as one of the most ambitious strategies in Europe to address both climate change and the need for good-quality affordable housing. In the years to come, we look forward to following the CEEPF team in their work to create positive impact and deliver a competitive risk-adjusted financial return.

”Through our work with CEEPF, and our investment in Catella European Residential Fund III, CRIM has shown alignment with KLP’s dedication to corporate responsibility, which we find encouraging.”

To read the latest edition of IPE Real Assets magazine click here.