UK-based investment pool Border to Coast Pensions Partnership added £4bn (€4.8bn) of commitments from partner funds to its second private markets programme (Series 2), bringing total investments in the programme to date to £10bn.
The first tranche of Series 2 commitments will see invested over the next year £1.03bn in infrastructure, £705m in private equity, and £985m in private credit.
It also includes a £1.35bn Climate Opportunities offering, which will be invested over a three-year period and will target investments that will have a material positive impact on climate change and support long-term net zero carbon emission goals.
It will include investments across private equity, infrastructure and private credit, and will focus on clean/renewable energy, technology, transport, industry, agriculture, and carbon sequestration.
Mark Lyon, head of internal management at Border to Coast, said: “Our private markets programme is highly valued by our partner funds and is a key part of our offering. The addition of a Climate Opportunities offering continues to meet the need for enhanced long-term returns while helping drive the essential transition to a low-carbon economy and supporting efforts to combat climate change.”
At the beginning of the year the pool added a further £1.2bn to its private market investments.
Both moves are part of a £2.7bn private markets programme announced in summer of 2021 and have been deployed across a range of new infrastructure, private equity, and private credit funds.
In September 2021, Border to Coast announced its commitment to achieving net zero greenhouse gas emissions across its investment portfolios by 2050 or sooner.
This commitment included creating and evolving investment propositions aligned with net zero emissions by 2050 and facilitating increased investment in climate transition solutions.
The Climate Opportunities offering forms one part of the pool’s long-term plan to achieve this goal, it said.
Border to Coast’s Private markets programme
First launched in May 2019, Border to Coast’s private markets programme is designed to offer its Local Government Pension Scheme (LGPS) partner funds access to a wider range of investments, including via co-investments, with the aim of providing enhanced, diversified, risk-adjusted returns.
According to Border to Coast, investments are selected using a robust investment process, focusing on investment and operational due diligence and portfolio construction, which is undertaken by the internal pool’s team supported by third-party service providers.
An integral part of this process, it said, is a strong focus on how managers incorporate ESG and responsible investment considerations into their investment process.
Series 1 contained three one-year tranches – 1A (£1.2bn), 1B (£1.8bn) and 1C (£2.7bn). The new commitments take the programme to £9.7bn.
Funds participating in Series 2 are Bedfordshire, Cumbria, Durham, East Riding, North Yorkshire, Surrey, South Yorkshire, Teesside, Tyne & Wear and Warwickshire.