German insurer Allianz is open to investing more in infrastructure debt than the €400 million it currently has under management by Allianz Global Investors (AllianzGI), Deborah Zurkow, the head of AllianzGI’s infrastructure debt business, told Infrastructure Investor sister publication Private Debt Investor.
Whereas Allianz’s €400 million infrastructure debt commitment is currently managed through a separate account, Zurkow explained that this won’t preclude the insurer from investing in the team’s future vehicles, such as a global fund, were the team to go down that route. In the meantime, the Allianz seed investment will allow the team to start closing deals.
As previously reported, AllianzGI is in the initial stages of launching a £1 billion (€1.2 billion; $1.6 billion) infrastructure debt fund targeting “conservative, Sterling-denominated UK infrastructure projects,” a spokeswoman had previously explained. The fund is set to launch in the second quarter. However, Zurkow has her sight sets on more funds and other bespoke structures.
“I think there is a tendency to believe there is a one-size-fits-all fund that will work for all investors. But the truth is that investors across Europe have different regulatory environments to deal with and they have different access routes relative to their own capacity and administrative level to realty bonds or private placements,” she argued.
Zurkow added: “We will at some point do something like a Luxembourg vehicle, but we are less focused on that at the moment because we are finding there are special vehicles in France, in Germany and elsewhere that better suit the needs of investors.”
AllianzGI is targeting returns of between 4 and 6 percent for its investment-grade senior debt investments.
The investment management arm of Allianz bet big on infrastructure last year, recruiting two teams to develop renewable and infrastructure debt investments. The debt team was the first to be hired, with Zurkow, formerly of infrastructure-focused Trifinium Advisors, a wholly owned subsidiary of monoline insurer MBIA, brought on board last summer to found the debt business.
*To read the full keynote interview with Deborah Zurkow, check out the April issue of Private Debt Investor.