The asset managers for the largest Dutch pension funds are supporting the government’s €1.7bn investment fund Invest-NL, which was launched last week.
APG, the €534bn asset manager for civil service scheme ABP, said Invest-NL could help transform projects from drawing board ideas into investable propositions for institutional investors.
This could be achieved through carrying financial risks market players are not willing to take.
It added that the investment vehicle could also bring public and private stakeholders together.
PGGM, the €238bn asset manager for healthcare pension fund PFZW, suggested that Invest-NL could create investment opportunities for institutional investors in primary infrastructure, where private capital can contribute to expensive transitions.
The investment fund could also play an important role during periods of financial stress by providing liquidity, it said.
The vehicle for impact investment – with the Dutch state as single shareholder – is to provide financing to fast-growing innovative companies involved in industrial technologies.
It will also focus on energy transition, in particular on electrification, a circular economy, agrifood and buildings.
Invest-NL will be run by a 40-strong team led by Wouter Bos, a former Dutch finance minister, who has also been a manager at energy giant Shell, as well as a partner at KPMG.
He said the fund’s aim was to quadruple the amount of risk-baring capital for the energy transition within five years.
In an earlier interview with a local newswire, he said other investors, including pension funds, were welcome to join, “as we will never finance more than 50% of the entire investment”.
Bos added that investments with large risks required much more market expertise.
A spokesman for Invest-NL told IPE the fund hadn’t yet committed assets to concrete projects.
Past experience has shown that it is difficult for the government to direct institutional asset flows.
The National Mortgage Institution (NHI) – launched in 2013 – ceased within a couple of years, following objections by the European Commission citing illegal government support.
Meanwhile, Dutch pension funds had invested dozens of billions or euros in local mortgage funds in the wake of low returns on government bonds.
The Dutch Investment Institution (NLII), established by pension funds and other institutional investors in 2015, also ceased operating because of a lack of investable projects.
Bos said Invest-NL differed from previous initiatives by focusing on the long term.