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IFM wins Landmark infrastructure mandates

21 November 2014

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One of the largest pension funds offered by a local authority has awarded a major infrastructure investment mandate to IFM Investors.

Avon Pension Fund and Dorset County Pension Fund have awarded mandates totalling GBP 227m. The GBP 187m mandate by Avon Pension Fund is one of the largest to be offered by a local authority scheme.

The mandates are the schemes' first investments into infrastructure, reflecting the increasing appeal class as schemes look for returns that can match long term liabilities.

Annabel Wiscarson, executive director, business development at IFM Investors, said: "Avon's first allocation to infrastructure is both a hugely significant step for the scheme and notable within the broader industry for its size, which far surpasses the average amount being invested by UK local authorities to date."

She added: "Investors are getting more comfortable with infrastructure as an asset class as their understanding of it grows, and we expect appetite to remain strong with schemes looking at new allocations."

Avon Pension Fund and Dorset County Pension Fund made their allocations to IFM investors following a collaborative procurement process in which they were advised by JLT Employee Benefits.

The mandates will be invested in IFM investors' portfolio of core equity infrastructure assets in global developed markets.

Matt Betts, assistant investments manager at Avon Pension Fund, said: "We decided to make a new allocation to infrastructure following a review of our investment strategy in 2013."

We wanted to diversify our assets, and looked to infrastructure due to its inflation linked, cash generating and liability-matching qualities."

"IFM Investors' portfolio and open-end investment structure, that allows allocations to be made for the long-term, were very attractive to us."

The GBP 3.58bn Avon Pension Fund administers the Local Government Pension Scheme (LGPS) for over 190 employers and almost 90,000 members in the former Avon area.

The GBP 2.2bn Dorset County Pension Fund has over 54,000 members.

First published - 21.11.2014

Lindsay.sharman@wilmington.co.uk