Two of Australia's largest pension fund investors pledged to pour $19 billion into U.K. and European markets in coming years, as the industry increasingly looks for opportunities overseas.
IFM Investors, owned by some of Australia's biggest pension funds, will spend £10 billion ($12.6 billion) on infrastructure and energy transition projects in the U.K. by 2027, under an agreement announced with the government there. Meanwhile, Aware Super said it will direct A$10 billion ($6.6 billion) to the U.K. and Europe through its new London office. Both firms are making their announcements at the Global Investment Summit in London on Nov. 27.
"The U.K. is taking steps to help facilitate long-term investment in infrastructure, and we currently see significant deployment opportunities, particularly as part of the U.K. energy transition in areas such as offshore wind, solar, battery storage, renewable fuels and pumped hydro," IFM Investors Head of Infrastructure Europe Deepa Bharadwaj said in a statement.
It's the latest sign of the growing international footprint of Australia's A$3.5 trillion pension fund industry, known locally as superannuation, which has increased assets invested overseas in recent years. Meantime, locations beyond Australia are becoming more important with Aware Super opening its London office last week and Australia's largest pension fund, AustralianSuper, building presences in London and New York in recent years.
Aware Super has already invested A$17 billion in the U.K. and Europe. The fund said its fresh round of investment would initially focus on real estate, infrastructure and private equity. It cited "emphasis" on the energy transition sector, affordable housing, innovation, life sciences, technology and the digital infrastructure sector.