A survey by AlphaReal of (1) UK Local Government Pension Scheme (LGPS) fund professionals reveals that 94% would like to increase their investment in the health sector.
74% of LGPS fund professionals believe health is suitable as part of a social infrastructure allocation, making it the most popular sector. This was followed by 58% who identified housing and 51% who cited education. This confirms these three core sectors of social infrastructure are the top priorities for LGPS funds looking to invest for social impact.
The research also reveals a particular appetite for health investment opportunities in the primary care sector with around two-thirds (67%) of LGPS fund professionals saying this sub-sector was of interest.
The two other health sub-sectors where respondents expressed the most interest were specialist care (65%) and elderly care (55%).
|Health sub-sector||Percentage of respondents interested|
|Primary care e.g. GP surgery||67%|
|Specialist care e.g. neuro||65%|
|Secondary care e.g. independent hospital||34%|
|Private treatment/specialist clinic e.g. fertility||29%|
With an increasing focus on social impact and levelling up, most LGPS fund professionals were aware of the social benefits available from health sector investments. Nearly nine out of ten (89%) of respondents say they are aware of the potential social impact.
Ed Palmer, CIO and Head of Sustainability, AlphaReal said, “Investing in the health sector offers LGPS funds the opportunity to achieve stable long-term returns while also supporting the essential health-related services on which their members and wider communities rely.”
Anne Copeland, Co-Head of Social Infrastructure, AlphaReal said, “AlphaReal believes the health sector is a multi-billion-pound investment opportunity for institutional investors driven by long-term structural demand, declining and inadequate supply, and significant funding shortage due to constrained public finances. At AlphaReal, we are ready to help investors realise this opportunity as they increase allocations to the sector through our multi-sector approach focusing on health, housing and education.”
AlphaReal invests in UK and European assets with predictable, secure, long-term cash flows. The asset manager provides market leading and innovative real asset solutions across a range of investments such as commercial ground rents, UK renewable infrastructure, and social infrastructure including health, housing and education.