Border to Coast, a UK local government pension scheme (LGPS), has launched a £1.2 bn (€1.4 bn) real estate fund to drive investment into key property sectors and ‘power up’ UK economic growth.
The UK Real Estate Fund aims to rank among the top 10 largest UK real estate funds, providing access to ‘high-quality UK assets offering long-term, durable income and stable returns’.
Three partner funds - Tyne and Wear Pension Fund, Cumbria Pension Fund, and South Yorkshire Pensions Authority – have pooled assets to seed the fund with properties at launch. They include offices, retail, care homes, student accommodation and industrial and warehouse facilities across 26 UK counties.
Border to Coast said it expects the fund to more than double in size to more than £3 bn in the next five years, to support greater LGPS investment into the UK. Besides traditional sectors, the vehicle will seek to target investment in new segments including life sciences and residential such as affordable housing.
Joe McDonnell, chief investment officer at Border to Coast, said: ‘The launch of UK Real Estate is testament to the progress our partnership has made to date. It is a sophisticated proposition that draws on the benefits of scale to unlock greater access to quality, long-term investment opportunities in the UK for partner funds. That same scale has enabled us to build a dedicated and highly skilled in-house team with years of experience in the UK real estate market to support partner funds.’
Cameron Murray, head of UK and European real estate at Abrdn, commented: ‘We are proud to have been appointed to support this incredibly important mandate and look forward to partnering with Border to Coast to deliver the objectives of the partner funds.
‘We are keen to enhance the base portfolio, utilising the skills of our dedicated transactions team in order to identify the best opportunities in the market, with a wider opportunity-set now available through the efficiencies of scale and an aligned approach to responsible investment.’
