Gresham House, the specialist alternative asset manager, has today announced the final close of their second sustainable infrastructure fund. The British Sustainable Infrastructure Fund (BSIF) II and its side-car vehicles has raised c.£450 million to accelerate the deployment of innovative, real asset-based solutions to some of the biggest environmental and social challenges facing the UK, giving investors exposure to a diverse portfolio that supports sustainable growth across the country.
BSIF II takes a holistic approach to infrastructure investment, with the Fund investing in appropriate solutions to regional social and environmental challenges. Portfolio companies supported by the Fund include alt-net providers connecting rural communities to gigabit broadband, vertical farms championing innovative agriculture techniques and habitat banks supporting developers to deliver biodiversity net gain, alongside local projects.
Twelve investors – eight leading LGPS and four family offices – have backed BSIF II, with the diversified nature of the Fund and the greenfield focussed strategy complementing their core infrastructure allocations. The multi-award winning BSIF strategy has a track record of delivering strong financial returns alongside positive impact, with BSIF I, return on investment to date double its stated target of 8-10% with a net IRR of 16.2% as at June 2023.
Heather Fleming, Managing Director, Institutional Business at Gresham House, said: “Investors are looking for innovative investment opportunities that support regional levelling up and the green agenda in the UK. We are delighted that our twelve investors see BSIF II as the opportunity to drive positive impact.
“We are giving LPs a platform for place-based investment, providing exposure to our portfolio companies and supporting the regions and sectors that most align with their sustainability targets. We are proud to empower LGPS investors to make sustainable investments that level up their region, while delivering a strong return on investments.”
Commenting on the attraction of BSIF II and the impact being delivered in their region, Cllr Jayne Kirkham, Pensions Committee Chair, Cornwall Pension Fund, said: “It is important to our members that their money is invested responsibly and sustainably. By partnering with Gresham House, the pension fund is supporting critical local infrastructure projects, boosting digital connectivity on our doorstep here in Cornwall, alongside other innovative solutions to environmental and social challenges across the UK.”
Cornwall Pension Fund and Bedfordshire Pension Fund are the latest to join Worcestershire Pension Fund, Teesside Pension Fund, Staffordshire Pension Fund, Greater Manchester Pension Fund, Torfaen Pension Fund and East Riding Pension Fund as LGPS investors alongside other existing LPs.
With more than £2bn of controlled pipeline within the portfolio, the £450 million raised will be quickly deployed into existing BSIF platforms to deliver the strongest financial impact, while supporting the evolution of a range of sustainability solutions across the UK.
Peter Bachmann and Simon Adcock, Co-Fund Managers of the BSIF Strategies, commented: “We are very pleased to have welcomed eight new LPs to BSIF II, and believe our focus on impact driving returns will perform well financially whilst capturing the attention of forward-thinking real asset investors. BSIF II is the next step for our platform, which we look forward to continuing to scale with future funds.
With portfolio companies delivering ground-breaking infrastructure solutions across UK regions including gigabit-capable broadband connectivity in Cornwall, innovative waste recycling solutions in the North East and vertical farming in Staffordshire and East Anglia, LGPS and other investors are attracted to the impact their investment can deliver for their communities.”