LGIM launches secure income fund
Legal & General Investment Management has launched a secure income assets fund for professional defined benefit pension schemes in the UK.
LGIM’s new fund will invest in a portfolio of secure income assets, including infrastructure debt, real estate debt and private corporate debt. It will be structured as an open-ended pooled structure, subject to a lock-in period.
It aims to achieve a return of gilts plus 2.5% per annum, over a rolling three-year period.
Legal & General Investment Management has launched a secure income assets fund for professional defined benefit pension schemes in the UK.
LGIM’s new fund will invest in a portfolio of secure income assets, including infrastructure debt, real estate debt and private corporate debt. It will be structured as an open-ended pooled structure, subject to a lock-in period.
It aims to achieve a return of gilts plus 2.5% per annum, over a rolling three-year period.
Five single strategies have also been launched as separate unit-linked life funds:
• Legal & General Senior Real Estate Debt Fund
• Legal & General Investment Grade Infrastructure Debt Fund
• Legal & General Investment Grade Private Corporate Debt Fund
• Legal & General Sub-Investment Grade Infrastructure Debt Fund
• Legal & General Sub-Investment Grade Private Corporate Debt Fund.
Mark Johnson, head of UK institutional clients at LGIM, said: “The launch of the Secure Income Assets Fund meets the growing demand from our UK DB scheme clients for innovative solutions that deliver reliable income.
“Investing long-term capital in secure income assets offers a compelling opportunity to generate these cashflows with attractive risk-adjusted returns and the potential for long-term owners of capital – insurers and pension schemes – to effect real and lasting change.”
Stuart Hitchcock, head of portfolio management, private credit, at LGIM Real Assets, said: “For investors with a long-term view, secure income assets are a core part of a cashflow-driven investment strategy, delivering a breadth and depth of universe not available in the public market.
“By negotiating better structural protections than public market equivalents, we aim to provide improved downside protection, reduced valuation volatility and lower correlation with traditional traded assets.
“We have invested in some of the UK’s largest economic and social infrastructure, alongside renewable projects and real estate – our focus is to deliver significant financing to both the public and private sector, in order to serve our investment clients’ cash flow needs, while making a positive social impact.”
LGIM Real Assets has more than £35.1bn assets under management.
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