PGGM, the Dutch pension fund asset manager, is close to having its debut infrastructure fund fully invested, Henk Huizing, PGGM’s head of infrastructure investments, told Infrastructure Investor.
“We currently invest [in infrastructure] through the PGGM Infrastructure Fund, which is a fund we started in January 2010,” Huizing said. “Our three pension clients that invest in infrastructure provided commitments of €1.25 billion into this fund.”
He added: “Until 2010, we just had a segregated portfolio for PFZW [PGGM’s largest client with €102 billion of assets under management], but from 2010 onwards we have this infrastructure fund, which has a two-year investment period. We are currently one-and-a-half years down the road and we have presently invested €1 billion, so we are almost there.”
The fund, which is targeting a yield of 5 percent, has a two-year investment period ending December 2011. “We plan to start a new fund at the beginning of 2012,”Huizing pointed out.
PGGM currently has assets under management/invested capital in infrastructure of €1.6 billion. Adding commitments to infrastructure, that amount rises to €2.5 billion. “Compared with the Canadian and Australian pension funds – [which] sometimes have allocations to infrastructure of 10 percent or 15 percent – [our clients’] actual allocation to infrastructure […] is still very modest,” Huizing commented.
However, Huizing wants PGGM’s infrastructure allocation to increase in the near future: “There is a growth target [for our infrastructure allocation] – I think it’s 2.5 percent to 3 percent within the next two-and-a-half years. Of course, further growth in the allocation will depend on our performance. So if we perform well, it’s likely that our allocation will increase,” Huizing adds.
To read the full interview with Henk Huizing and learn more about PGGM’s recent partnerships with BAM PPP and Lend Lease, check out Infrastructure Investor’s September 2011 issue.