In 2022, we wrote about a feature of the pensions risk transfer market we termed ‘the liquidity kink’. A year on, many pension schemes can now afford to buy-out with an insurer, yet schemes still hold illiquid assets.
Over the last two years or so there has been a seismic change in the UK pension scheme investment landscape.
Renewable infrastructure is an increasingly popular asset class among institutional investors, with a recent AlphaReal survey highlighting that over 90% of UK pension funds and insurers are looking to increase their allocations over 2024.
Renewable infrastructure assets continue to be deployed at pace across the UK as the country races to achieve net zero by 2050 and decarbonise the electricity system by 2035. Consequently, renewable electricity generation has increased fivefold since 2010.
Upcycling is not only a trend in fashion or furniture, but also an important way of increasing the delivery of social infrastructure across the health, housing and education sectors by giving a new life to redundant real estate assets.
Commercial Ground Rents (‘CGR’) provide investors with index linked cashflows that have bond-like characteristics and offer property owners an attractive form of long-term finance. The parties to a CGR are akin to a borrower and lender, although the relationship is governed by a lease not a loan.
This secure income made simple guide will show why secure income can play a role in helping pension investors achieve their investment objectives and that now could be an excellent time to capture the opportunity at an attractive price.
This insight looks at why investment in greenfield projects in the UK is important in the renewable energy transition.
We recently commissioned a survey of European life insurance company investment professionals that collectively oversee €2.73 trillion in assets.
We asked European pension fund professionals, who collectively oversee €324 billion in assets, questions about their investments.
What is social, impact investing and social infrastructure? ‘Social’ is about people and places contributing to net positive outcomes for those who receive and deliver (essential) services, and wider stakeholders such as their families and communities.
In 2022, we wrote about a feature of the pensions risk transfer market we termed ‘the liquidity kink’. A year on, many pension schemes can now afford to buy-out with an insurer, yet schemes still hold illiquid assets.
The UK Government has encouraged institutional investors to support its levelling up ambitions. In setting out its levelling up plan, the Government specifically mentioned the c.£320 billion LGPS:
The UK Government recently announced that affordable childcare would be prioritised in budget allocations.
New AlphaReal commissioned research with UK Local Government Pension Scheme (LGPS) fund professionals reveals that three quarters of respondents cite the health sector as suitable for a social impact infrastructure allocation.
Are pension schemes missing out on the illiquidity premium? Investing in secure income illiquid assets can bring more certainty to a scheme’s journey plan. The ‘liquidity kink’ means schemes targeting buy-out believe they can’t exploit the illiquidity premium.