Montana Board of Investments is planning to convert its natural resources portfolio into a real assets allocation and introduce infrastructure investments.
The $12.5bn (€10.6bn) pension fund will seek approval in next month’s board meeting to broaden the portfolio, which currently comprises energy, timber, natural resources and related public securities assets, to include infrastructure, commodities and inflation-linked bonds.
The real assets would represent 5% of Montana Board’s total assets and infrastructure could form up to half of the porfolio.
In a board meeting document, Montana Board said infrastructure typically generates steady cash flows and capital appreciation, producing returns of between 5% and 12%, and it believes there are attractive opportunities in the asset class.
Infrastructure investments would be made through commingled funds.
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