The London Pension Collective Investment Vehicle’s (CIV) is understood to have chosen US-based adviser Stepstone as the fund manager for its planned GBP 2bn infrastructure vehicle.
London CIV, an investment vehicle for Greater London’s 33 local government pension schemes, is believed to have appointed Stepstone as the underlying fund manager for London CIV Infrastructure Fund I earlier this month.
The vehicle will aim to raise around GBP 2bn over the next few years and will start taking commitments in January. London’s 32 boroughs and the City of London Corporation will be able to invest in the new fund, which will make primary and secondary fund investments with one or two assets in the UK.
Currently London CIV manages 13 vehicles in the global, emerging market and UK equity, fixed income and multi-asset sectors. The vehicle works with underlying fund managers including Allianz Global Investors and RBC Global Asset Management.
Stepstone has been recently active in the UK. It is a shareholder in UK Airports Topco Limited, believed to be a holding company for Bristol and Birmingham Airports. The US-based adviser is also understood to have acquired shares last month in Forth Ports from PSP Investments, alongside GLIL Infrastructure, First State and the Construction and Building Unions Superannuation, a week after PSP took over full ownership of the port operator from Arcus.
London CIV is one of eight local authority pension groupings, along with Northern, Central, Brunel, ACCESS, Wales, Borders to Coast and LPP, which together pools capital from the 91 local authority pension funds in England and Wales. George Osborne, the UK’s former chancellor, announced the pooling of England’s and Wales’ pension funds at the summer budget in July 2015.
Last year Willis Tower Watson undertook a governance review of London CIV which highlighted “significant concerns”, according to a document published by the City of Westminster Pension Fund Committee on 23 January. One of the concerns raised was “a perceived lack of transparency” from London CIV in a number of areas, including “particular concern in relation to manager selection” for the vehicle’s funds.
The review recommended that there was to be a recognition of the “importance of transparency and cultivating trust, and a clear cultural and strategic shift to embedding this at the heart of LCIV pooling arrangements”. The review reportedly pushed back the launch of London CIV’s infrastructure fund.
London CIV and Stepstone did not respond to comment by the time of publication.