CASE STUDY
Core-plus/value-add Infrastructure
Asian Pension Plan | Winter 2020
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Core-plus/value-add Infrastructure
Engagement at a glance
Bfinance is supporting an Asian pension plan and its gatekeeper in building out a global infrastructure portfolio with an allocation of up to $150 million to fund one or more managers implementing core-plus/value-add strategies spanning OECD countries. The client’s target return is 10% net to complement its existing core holdings.
Client-specific Concerns
Since January 2020, bfinance has been supporting this client in its ongoing search for core-plus/value-add infrastructure managers in OECD countries. The client wanted to invest in pooled funds and had expressed a preference for diversified exposure across traditional infrastructure assets, although it was open to emerging sectors. To that end, managers were required demonstrate their track record in core-plus/value-add investments.
Outcome
- Planning allocations to optimise pace of commitments: bfinance undertook portfolio-level analysis to help the client assess its potential commitments and better understand its infrastructure exposures and cash flows.
- Analysing the changing universe of offerings: On a regular basis, bfinance provided the client with updates on the manager universe and fundraising timetables, and helped its team identify several routes to attain double-digit returns – including large-cap managers investing in traditional infrastructure assets; managers seeking to be ‘new entrants’ in emerging sectors; and specialists in niche sectors, such as digital infrastructure and cold storage.
- Assessing the overlap between new and old: The client sought to understand the complementarity of managers’ strategies relative to its core infrastructure portfolio and the potential combinations needed to achieve double-digit net returns. The client also wanted to explore whether assets targeted by prospective managers would remain within the boundaries of infrastructure or veer into ‘asset-lite’ private equity-style businesses.
- Adapting to market insight: The client has chosen two managers (to date); one with a bias toward European assets, and one with a bias toward North American assets.
Our specialist says
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A growing number of infrastructure strategies are veering up the risk spectrum as more capital enters the asset class and core-plus/value-add managers have had to adapt their strategies to maintain return targets, including changing the target geographies or sectors. Effective due diligence, including close scrutiny of managers’ return theses and track records, can help investors to get a clearer picture of capability and credibility.
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Canada, Toronto
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United States, Chicago
220 North Green Street
Chicago
IL 60607
Telefon: (312) 829-4353
Email: info@bfinance.com
-
Canada, Montréal
1250 Rene Levesque Boulevard West
Suite 2200, Montreal
Québec H3B 4W8
Telefon: +1 450 902-4965
Fax: +1 514 393 9069
Email: info@bfinance.com
-
Canada, Toronto
88 Queens Quay West
Suite 2500, Toronto
Ontario M5J 0B8
Telefon: +1 (416) 560-7275
Email: info@bfinance.com
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United Kingdom
36 Queen Street, London
EC4R 1BN
Telefon: +44 20 7747 8600
Fax: +44 20 7747 8600
Email: info@bfinance.com
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Germany
Theresienstraße 1
80333 Munich
Telefon: +49 89 55 29 59 00
Fax: +49 89 55 29 59 00
Email: info@bfinance.com
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France
49, Avenue d'Iéna
75016 Paris
Telefon: +33 1 45 02 64 00
Fax: +33 1 45 02 64 01
Email: info@bfinance.com
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Netherlands
Symphony building
Gustav Mahlerplein 3-115, 26th Fl
1082 MS Amsterdam
Telefon: +31(0)20 794 61 00
Email: info@bfinance.com
-
United Kingdom
36 Queen Street, London
EC4R 1BN
Telefon: +44 20 7747 8600
Fax: +44 20 7747 8600
Email: info@bfinance.com
-
Germany
Theresienstraße 1
80333 Munich
Telefon: +49 89 55 29 59 00
Fax: +49 89 55 29 59 00
Email: info@bfinance.com
-
France
49, Avenue d'Iéna
75016 Paris
Telefon: +33 1 45 02 64 00
Fax: +33 1 45 02 64 01
Email: info@bfinance.com
-
Netherlands
Symphony building
Gustav Mahlerplein 3-115, 26th Fl
1082 MS Amsterdam
Telefon: +31(0)20 794 61 00
Email: info@bfinance.com
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Australia
Level 8, 99 Elizabeth Street, Sydney
NSW 2000
Telefon: +61 (0)2 8052 3930
Email: info@bfinance.com
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China
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199 Des Voeux Road Central, Sheung Wan
Telefon: +852 3953 7874
Email: info@bfinance.com
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Australia
Level 8, 99 Elizabeth Street, Sydney
NSW 2000
Telefon: +61 (0)2 8052 3930
Email: info@bfinance.com
-
China
Level 20, Infinitus Plaza,
199 Des Voeux Road Central, Sheung Wan
Telefon: +852 3953 7874
Email: info@bfinance.com