Legal & General’s investment management arm has set up a fund to invest in listed infrastructure companies and has also acquired an industrial estate for £182.3m (€209.3m) for its real assets division.
Legal & General Global Infrastructure Index Fund is expected to target companies that own, operate, manage or maintain essential infrastructure across a range of sectors, including utilities, industrials, and oil and gas.
Honor Solomon, the head of retail, EMEA, at Legal & General Investment Management (LGIM), said: “Infrastructure assets such as roads, railways and pipelines are essential for our economies to function.
“An attractive combination of capital growth and a stable income stream, in many cases linked to inflation, has meant listed infrastructure has become increasingly popular with investors.”
Solomon said this fund builds on the company’s commitment to providing exposure across a broad range of asset classes which advisers and investors can use as building blocks for constructing portfolios.
“Given its modest correlation with traditional asset classes such as equities, credit, and government bonds, listed infrastructure can also be a useful diversifier.”
Justin Onuekwusi, multi-asset fund manager at LGIM, said: “Listed infrastructure is an important asset class in a multi-asset portfolio. Over the long-term, it has delivered attractive risk-adjusted returns, which complements a diversified portfolio.
“Together with its attractive yield and defensive characteristics, the asset class is a mainstay holding across our £45bn multi-asset fund range.”
Also today, LGIM said its real assets arm acquired the Woodside Industrial Estate in Dunstable, England, from Harbert Management Corporation.
The asset was acquired on behalf of two separate funds, the Legal & General UK Property Fund and its Managed Property Fund, in a 50/50 joint venture, it said.
The property comprises 35 units totalling 1.5m sqft and occupies 96 acres.