Infra a key pillar in Nuveen’s real assets restructuring

The alternatives investment manager has added infrastructure and natural capital to its product offering, prompted by investors’ growing demand for real assets and sustainable investments.

Nuveen Infrastructure is one of two new business units the asset manager has added to its real assets platform as it seeks to become “the leading land-based asset manager”, according to a statement.

“Nuveen’s Global Institutional Investor Survey found that institutional investors are planning to increase allocation to infrastructure, natural resources investments and other alternative assets as they seek attractive returns, a reduction in climate-related financial risk exposure and to align portfolios with the transition to a sustainable low-carbon economy,” Mike Sales, chief executive of Nuveen Real Assets, told Infrastructure Investor.

According to the survey, which involved more than 700 institutional investors across the world, two-thirds plan to increase allocation to infrastructure, natural resources and other alternative assets.

Of those surveyed, 64 percent are currently invested in infrastructure, with 34 percent of those planning to increase exposure in the next 12 months, Sales added.

The new unit will combine the roughly $2 billion-worth of assets Nuveen acquired when it bought renewables-focused investment manager Glennmont Partners in March with its own diversified infrastructure portfolio, worth around $4 billion and including investments in renewables, digital, telecoms, transportation and social infrastructure. It will also include Nuveen’s agribusiness platform AGR Partners.

The second new unit, Nuveen Natural Capital, will combine Nuveen’s $7.7 billion farmland investment business – Westchester Group – with Greenwood Resources, which specialises in the acquisition and management of forestry assets. Both units will sit alongside Nuveen Real Estate, the third pillar of Nuveen’s real assets platform.

Asked why the firm decided to include its agribusiness unit in infrastructure rather than natural capital, Sales responded: “Unlike Westchester, AGR investments do not necessarily have a land-based component, so the focus will be slightly different.

“Its investment strategy of investing in operating, asset-heavy businesses is closer to the risk-return strategies pursued in Nuveen Infrastructure.”

Justin ‘Biff’ Ourso, a senior managing director who has been with the firm for 16 years, will serve as global head of Nuveen Infrastructure. His direct reports will be Joost Bergsma, a co-founder of Glennmont; Andy Deihl, who has been with Nuveen since March 2019 overseeing its infrastructure portfolio and spent 15 years before that at parent company TIAA, the Teachers Insurance and Annuity Association of America; and Ejnar Knudsen, chief executive of AGR Partners.

The new real assets platform will launch in January.