Golding Capital Partners announces the first close of its Golding Infrastructure 2020 fund of funds with commitments of €440 million. This confirms the Munich-based asset manager’s position as one of Europe’s leading providers of infrastructure investment opportunities and brings its assets under management in this asset class to more than €4.5 billion. The Golding Infrastructure 2020 programme invests in infrastructure assets that address some of the key megatrends affecting our society, such as urbanisation, climate change, digitisation and healthcare. Pension funds and insurance companies, but above all also savings banks and cooperative banks committed to the first closing of the fund.
Golding Infrastructure 2020 is a fourth-generation fund and will pursue the successful investment strategy of its predecessors, with a global approach diversified by sector. This investment strategy again proved very popular with existing investors, who make up 60 per cent of the fund, but also attracted many new investors. “We are delighted by this strong response from our investors, because it shows that our conservative strategy of aiming for yield with an attractive overall return is exactly what they are looking for. This is an important aspect not only for pension funds and insurance companies, but also for mid-sized banks, for whom resilient infrastructure investments represent an increasing component of their proprietary trading activities”, explains Managing Partner Hubertus Theile-Ochel.
The investment strategy for Golding Infrastructure 2020 consists of building a broadly diversified portfolio of around 15 infrastructure funds (primaries and secondaries) with a focus on Core/Core Plus investments (projects with contractually guaranteed or state-regulated income), brownfield investments in existing facilities and selected co-investments. It is expected to cover the key infrastructure markets in Europe and North America, as well as sectors including energy, transport, utilities and social infrastructure.
“Our first investment for the Infrastructure 2020 programme is a Core fund focusing on Europe with a diversified sectoral allocation. Two further commitments should be made before the end of May, and the pipeline thereafter also looks very promising. When we select the managers of portfolio funds we concentrate on independent managers with long-standing infrastructure experience and a proven track record”, says Dr Matthias Reicherter, Managing Partner and Chief Investment Officer at Golding. “They also look closely at ESG aspects, which are particularly important for us. An ESG assessment is carried out for every investment using our Golding ESG assessment tool as an integral part of the due diligence process. All the portfolio fund managers included in the Golding infrastructure portfolio since 2016 have, without exception, signed up to the UN PRI.”
The portfolio construction is aimed primarily at generating continuous yield. Golding forecasts a target net IRR of 7-8 per cent p.a. for the infrastructure fund and is planning a final close at the end of the year at a volume of at least €700 million.
Infrastructure – a stable, growing asset class
Modern infrastructure is a key condition for long-term economic growth and a prosperous society. There is a growing need worldwide for investment in this area, which the Global Infrastructure Hub puts at some €100 trillion by 2040. This applies to both industrialised economies in North America and Europe as well as emerging markets in Asia, Africa and Latin America. Combined with rising global demand for capital investment opportunities, this creates attractive, long-term market conditions. Various government initiatives, such as the EU Green Deal, the German federal transport infrastructure plan 2030 and the climate action targets set by the US administration also add up to a favourable environment for greater investment activity.
Golding has successfully invested in around 60 primary, secondary and co-investments since starting out in the infrastructure segment in 2011. In the infrastructure asset class Golding now manages over €4.5 billion for institutional investors, including insurance companies, pension funds, charitable foundations, family offices, savings banks and cooperative banks. This capital is currently spread across twelve investment programmes (including fund-of-funds, co-investment funds and managed accounts).