Impact investor Bridges Fund Management has raised over £440m (€508m) for its latest European property strategy, with UK local government pension schemes (LGPS) and Fidelity International among its investors.
The Bridges Property Alternatives Fund VI (Fund VI) fund’s backers include a diverse group of pension funds, insurers, family offices and other institutions, such as Border to Coast Pensions Partnership, the Environment Agency Pension Fund, University College Oxford, South Yorkshire Pensions Authority, East Riding Pension Fund and Clwyd Pension Fund.
The specialist sustainable investor said Fund VI’s total commitments at close, including co-investment, was over £440m, surpassing its target of £400m.
Fund VI will target sustainable property investments, focusing on needs-driven sectors with strong growth fundamentals such as housing, healthcare and logistics, the manager said.
The predecessor fund in the series closed in June 2022 with £350m in capital, backed by a range of institutional investors including the Church Commissioners for England and several UK local authority pension schemes.
The manager said Fund VI has already deployed capital into 10 investments across Bridges’ core sectors, including the Cornerstone and Minories co-living projects in the City of London, the Torque low-carbon industrial development in Erdington, Birchgrove’s purpose-built elderly accommodation and Renaiss Health’s specialist healthcare platform.
Simon Ringer, partner and head of property funds at Bridges Fund Management, said: “We are delighted to have closed Fund VI ahead of target, with strong backing from both existing and new institutional investors. Their support – especially at a time of reduced market liquidity – is testament to the strength of our impact-driven investment strategy and track record.
“Over the past 15 years, we have shown that by investing in areas where there is a favourable relationship between needs-driven occupational demand and restricted market supply, we can deliver competitive financial returns alongside positive social and environmental impact.”
Vivian Liu, private markets portfolio manager, Fidelity International, said: “Our clients are increasingly looking for access to attractive sustainable investment opportunities within private markets.
“Bridges’ specialist real estate strategy has a proven track record of identifying and executing property investments where sustainability can be a clear driver of value creation – so Bridges Property Alternatives Fund VI was an obvious choice for our portfolio.”
Ian Sandiford, head of alternatives, Border to Coast Pensions Partnership, said: “Building on the significant investment our partnership has made in the UK to date, our commitment to Fund VI enables us to pursue sustainable investment opportunities with attractive growth potential whilst meeting the growing need for housing and healthcare real estate, all on behalf of LGPS Partner Funds.
“It puts LGPS capital to work supporting the needs of communities and looks set to deliver clear social and economic benefits – an ambition of our UK Opportunities investment strategy. We look to build strong partnerships with our managers and look forward to working closely with Bridges to continue to deliver for the LGPS.”
Scott Anderson, investment manager, Environment Agency Pension Fund, said: “Delivering best-in-class sustainability outcomes alongside strong financial returns is fundamental to EAPF’s investment approach. Bridges’ real estate funds have been a pioneer of this approach in the UK, with a proven ability to identify opportunities to decarbonise the built environment while improving outcomes for the local communities in which these buildings sit.
“We’re excited to be partnering with the Bridges team for a fourth investment. At this time of unprecedented environmental and nature-related challenges, the importance of expert-led sustainable investment has never been greater.”
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