Border to Coast Pensions Partnership, Leeds, England, is looking for a specialist manager for a new U.K. real estate fund.
The fund will initially invest £1.75 billion ($2.1 billion) in U.K. properties but is expected to grow to more than £3 billion as more partner funds get involved, Border to Coast said in a news release.
Border to Coast is owned by 11 local government pension funds and has combined assets of £60 billion.
The external manager will work with Border to Coast's internal real estate investment team to develop and implement the investment strategy, source U.K. real estate opportunities and provide asset management services for real estate assets. The manager will also embed active stewardship and ESG considerations during portfolio construction and asset management, the news release said.
In addition to the main real estate fund, Border to Coast has a second fund to hold indirect assets, such as real estate investment trusts and large UK balanced real estate funds. "The Gateway fund is being used as a mechanism to provide exposure to real estate prior to the capital being deployed" in the main fund, a spokesman said in an email.
Border to Coast also has a separate global real estate fund expected to reach £1 billion. The total real estate investments are expected to reach £5 billion eventually, the spokesman said, with the size and balance between the funds depending on the partner funds' investment strategies "and the structure and remit of the funds once completed and launched."
MJ Hudson is assisting with the manager search for the U.K. direct real estate fund that is expected to conclude by the second quarter of 2023, "at which point the new manager will assist us with preparations to transition the £1.75bn property assets from Partner Funds into our new fund in 2024," the spokesman said.
Alistair Smith, head of real estate at Border to Coast, said in the release that they are "looking to build a long term, trusted relationship, and look forward to speaking with specialists in U.K. real estate that can help us achieve this."