Greencoat raises more than €900m for solar fund II

New commitments from institutional investors have driven the renewables-focused asset manager closer to its €1.1bn target.

Greencoat Capital has raised more than £800 million (€908.0 million; $1.1 billion) for its second solar fund, a spokesman for the firm told Infrastructure Investor.

When added to the £295 million the firm raised for Greencoat Solar Fund I – launched in September 2016 – the total is more than £1.1 billion, making it “the largest dedicated fund” investing directly in UK solar farms, Greencoat said in a statement.

Of the £1.1 billion committed, more than £610 million has been invested in 62 projects with a combined generating capacity of 476MW.

Known investors in Fund II include several corporate UK pensions such as those of ITV, Akzo Nobel, Northern Trust Nominees (Ireland), C & J Clark, Marks & Spencer and Syngenta.

According to pension fund documents seen by Infrastructure Investor, last month the Strathclyde Pension Fund asked its investment committee to approve a £50 million investment to Fund II. It is unclear whether the commitment was approved. Greencoat’s spokesman declined to comment on the matter.

The documents show that Greencoat Solar Fund II has a 25-year term, a target size of £1 billion and an IRR of 4.5 to 5.7 percent.

“Fund II will acquire operational ground-mounted solar assets built under either the Renewable Obligation Certificate (ROC) or Feed in Tariff (FiT) subsidy schemes,” according to Strathclyde’s pension documents. “Investment sizes will typically range between £5 million and £25 million for individual assets, although in limited instances could be larger.”

In February, Greencoat acquired a 142MW portfolio, which comprises 24 sites across the UK, from Canadian Solar, through Fund II. The portfolio was valued at £191.2 million, according to the vendor.

In addition to solar energy, Greencoat also invests in wind energy and private equity. Its assets under management total more than £2 billion, according to its website.

Additional reporting by Zak Bentley.