PIP launches multi-strategy infra fund

The UK pension platform is looking to collect £1bn to invest directly in core assets just a week after hiring a fundraising heavyweight.

The UK’s Pensions Infrastructure Platform (PIP) today launched the PIP Multi-Strategy Infrastructure Fund with a target size of £1 billion ($1.4 billion; €1.3 billion).

The vehicle marks the platform’s entry into the world of direct investing, a move it had been intending to make since being authorised about a month ago as a full-scope Alternative Investment Fund Manager by the Financial Conduct Authority, the UK's financial watchdog.

The news comes a week after PIP hired non-executive director Isabel Liu, an industry heavyweight whose credentials include setting up four infrastructure fund management businesses.

PIP’s Multi Strategy Fund will aim to offer institutional investors a degree of alignment and transparency “not available elsewhere in the market today”, the platform said in a statement. PIP added that larger investors will also have the possibility to co-invest to reap economies of scale.

“Until PIP was established, the market was really geared towards short-term investors. We have more control now, so we have access to opportunities that are tailored to the specific needs of a pension fund,” said Bailie Philip Braat, chair of the Strathclyde Pension Fund, a founding investor of PIP.

Beyond focusing on core infrastructure, the fund will have a wide-ranging remit, covering sectors including transportation, renewable energy, utilities, telecoms, housing and social infrastructure. It will have a long-term, buy-and-hold investment strategy geared towards generating low-risk, inflation-linked cash flows, PIP said.

Founded in 2013 with a £2 billion target size, PIP passed the £1 billion fundraising mark in July. The money was so far managed through the Dalmore PPP Equity PIP Fund, Aviva Investors' PIP Solar Photovoltaics Fund and a £370 million co-investment alongside Dalmore in the £4.2 billion Thames Tideway Tunnel.