Legal & General Capital and Patron Capital have launched a new fund to identify and invest in long-term, operational, real-estate and infrastructure backed investment opportunities with a positive social impact.
Patron will act as the primary originator and day-to-day investment manager, using its wealth of experience and resources.
The new partnership, known as the Perpetual Opportunities Partnership (POP), supports Legal & General’s strategy to play a greater role in UK housing and infrastructure, with an appetite to provide long-term capital to the energy, housing, urban regeneration and alternative financing sectors. The investments will be made both by Legal & General Capital, L&G’s principal investment team, and Patron Capital as co-investors with Legal & General Capital being the majority stakeholder.
POP will initially focus on the UK and Ireland, principally targeting stable, operationally geared investments that offer strong risk-adjusted returns, whilst also providing a wider positive social impact. The partnership will have a perpetual life cycle, investing for the medium to long term.
The partnership will target assets that do not fit the opportunistic criteria for Patron’s existing funds, given their longer term nature, and do not conflict with Legal & General’s existing direct property origination platforms, given the specific characteristics of these investments. POP will invest strategically and will not be constrained by deal size, although investments are likely to range between £20m and £200m of equity.
Paul Stanworth, managing director, Legal & General Capital, said: “We believe that by taking a flexible, strategic approach to investing in housing and social infrastructure, we will not only offer our shareholders attractive risk-adjusted returns but also drive UK economic growth and contribute in a significant way to enhancing UK living standards”
Keith Breslauer, managing director of Patron Capital, said: “The tie-up with Legal & General will enable us to consider longer-term investments that are lower on the risk-reward spectrum, meaning we will be able to act on a greater proportion of the €9bn investment pipeline we review each year. Corporate Social Responsibility is an integral part of the Patron approach, and this new partnership will enable us to make investments that will positively impact local communities through improving social infrastructure across the UK and Ireland.”
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24 January 2014 | Updated: 29 January 2014 9:09 am