The Strathclyde Pension Fund is increasing its investment in the Green Investment Bank 's pioneering offshore wind fund by £30 million ($40 billion; €35 billion).
The increase, revealed in the Glasgow-based pension's latest quarterly minutes, adds to a previously committed £50 million, bringing its total tally to £80 million. However, Strathclyde says it got “more favourable terms than on its initial commitment”, which will apply retroactively to the £50 million already invested and any new capital going forward.
In the documents, Strathclyde says GIB has raised £818 million from seven investors for the 25-year fund, which is targeting £1 billion with a £1.5 billion hard-cap. Known LPs include Swedish life insurance and pension provider AM Pensionsforsakring AB, which committed £300 million to the fund at its October second close, as well as the Abu Dhabi Investment Authority, the Worcestershire County Council and West Yorkshire pension funds, which contributed to the vehicle's first close.
GIB also committed £200 million of its own money to the offshore wind fund.
The Glasgow-based pension says the fund's first investments are performing well “with all assets reporting above budget availability for the year and all producing strong initial cash yields for investors”. The fund is targeting gross yields of between 9 percent and 11 percent.
Strathclyde also highlighted the fund's forward-looking pipeline, singling out one unnamed asset as “highly compelling” and the main reason for the new round of fundraising. Should the fund manage to acquire it, that would “complete the investment phase of the fund”.