IFM Investors, Nest Complete First UK Investments

Global infrastructure manager IFM Investors and the U.K.’s Nest [National Employment Savings Trust Corp.] have completed their first U.K. investments since the U.K. pension fund took a 10% stake in IFM in February.

As part of the partnership, Nest committed close to 500 million pounds ($671.25 million) to seed a global infrastructure debt fund managed by Melbourne, Australia-based IFM, which has now completed its first two investments—both in the U.K.

The investments include A$82.6 million ($53.6 million) to support the rollout of rural fiber broadband infrastructure across Scotland and northern England, and a further A$93 million ($60.4 million) backing an energy-from-waste and decarbonization business in the Midlands and northern England.

These projects were selected to target essential areas of the U.K. economy, helping to create jobs in the local community, drive decarbonization, support the government’s regional growth agenda and strengthen the country’s digital connectivity and energy resilience for the future, according to the announcement.

“At Nest, we’re committed to delivering strong, consistent returns for our members while supporting U.K. economic growth—investing in U.K. private markets is a key part of achieving that,” Nest CIO Liz Fernando said in a statement. “Through our strategic partnership with IFM, we’re backing high-quality infrastructure projects at home. From expanding high-speed broadband to rural homes and businesses to supporting waste-to-energy facilities, these are enticing investments that will also help create jobs, apprenticeships, and new regional offices, helping to power growth across regions.”

Fernando also stated that Nest has already committed 4 billion pounds ($5.4 billion) to U.K. private markets and has the goal of reaching 12 billion pounds ($16.1 billion) of investment by 2030.

IFM Head of European Debt Investment David Cooper said IFM is proud to support Nest with the new investments.

“We believe investing in infrastructure is critical to powering the digital economy, cutting carbon emissions, and driving the energy transition,” Cooper said in a statement. “Private debt capital is a key enabler—offering relative value for investors and, most importantly, their members.”

The investments aim to support Nest’s ambition to diversify and increase its allocation to private market assets to 30% in the coming years from about 18%. They also align with the U.K. government’s Mansion House Accord, which calls on defined contribution pension providers to allocate at least 5% of their portfolios to U.K. private markets.

A version of this article originally appeared in our sister publication, Financial Standard, which, like CIO, is owned by ISS STOXX.