Aviva Investors, the global asset management business of UK insurance giant Aviva, has launched a real assets fund of funds product.
Called the Aviva Investors Climate Transition Real Assets Fund, it aims to give investor groups, including defined contribution (DC) schemes, with access to climate-focused investments, mainly from direct real estate, infrastructure and forestry assets.
The fund will aim to deliver a net annual return of approximately 8% per annum over rolling five-year periods, whilst targeting net zero by 2040 or sooner.
It has been initially seeded with approximately £425 mln (€492 mln) of investor equity which, combined with the ability to leverage up to 50% of loan to value, will generate approximately £1 bn of deals.
Daniel McHugh, CIO, Real Assets, said: ‘There is a huge opportunity to drive our physical built environment toward net zero through Real Assets, where significant investment capital and firepower can make a direct and very material impact through increasing renewable energy, reducing emissions from the overall sector and removing carbon through nature-based solutions.’
The fund is the fourth in Aviva Investors’ Climate Transition range, with the business having launched funds focused on Global and European Equities in 2020 and its Climate Transition Global Credit Fund in May this year. In January 2021, Aviva Investors announced its plans to reach net zero emissions across the whole of its £48.7 bn Real Assets platform by 2040.
In an interview with PropertyEU in 2020, the company had said it was ready to launch new products.
