Foresight Group, an independent infrastructure and private equity asset manager, has launched the FP Foresight UK Infrastructure Income Fund, which will invest in UK-listed renewable energy and infrastructure fund / investment company equities and bonds, targeting an annual income of 5% per annum with dividends paid quarterly.
The group said that the growth in investment in UK renewable energy and infrastructure seen over the last five years is expected to continue, further referring to projections from a UK government’s report from 2015 that forecasts a 27% increase in cumulative UK renewable energy generation for the next eight years.
Foresight believes that renewable energy and infrastructure are attractive asset classes as they are characterised by stable and predictable demand, high barriers to entry and long term contracted revenue streams. UK listed renewable energy and infrastructure funds / investment companies also benefit from protection from inflation as a high proportion of underlying asset revenues are directly linked to inflation. The comfortable spread between listed UK renewable energy and infrastructure funds’ discount rates and the risk-free rate provides a further buffer to interest rate rises.
“The new FP Foresight UK Infrastructure Income Fund enables investors to capitalise on a thriving energy sector, which offers numerous investment opportunities across generation, transmission and distribution technologies. The global decarbonisation agenda will lead to a growing reliance on renewable energy, which is becoming cheaper to produce and easier to store,” Jamie Richards, Partner at Foresight, said. “We’re excited to be launching this infrastructure income fund which we expect to have broad appeal.”
Philip Payne, Director of Mulberry Wealth Management said: “Infrastructure has historically been regarded as the domain of institutional investors. However, we have found the asset class becoming increasingly attractive for our clients as more opportunities open up. Investors find the predictable revenue streams and stable returns compelling, particularly in times of uncertainty when markets are rocked by volatility. Foresight has a strong track record of innovation and infrastructure investment and we expect our clients will find the Fund’s target yield of 5% particularly appealing.”
The Fund will be actively managed and distributed by Foresight Group LLP.