Border to Coast Pensions Partnership has added a new manager to its Global Value-Add Real Estate fund.
The organisation – which pools the assets of 11 Local Government Pension Scheme (LGPS) funds – has allocated $90m (£67m) Heitman’s North American real estate strategy.
Through Heitman, Border to Coast, which has more than £55bn in assets under management, will gain exposure to a range of “non-traditional” real estate sectors, including self-storage, senior housing, student accommodation, and other specialist assets.
In a press release, Heitman said these markets were often less correlated with mainstream real estate cycles and offered the potential for strong risk-adjusted returns.
Paul Campbell, portfolio manager at Border to Coast, said the partnership reflected the fund’s strategy to broaden exposure beyond traditional asset classes.
He said: “Heitman’s deep history and experience investing in alternative property types align with our interest in diversifying into segments and markets with strong long-term fundamentals. This commitment underscores our confidence in their ability to execute and drive value across geographies.”
This deal also demonstrates a growing appetite among UK public pension funds for alternative real estate strategies.
Mike Trench, executive vice president and co-head of Heitman’s value funds, said: “We are proud to partner with Border to Coast as they expand their global real estate footprint.
“Their support reflects a strong alignment with our investment approach as European investors increasingly seek differentiated access to alternative sectors.”
Border to Coast launched the Global Value-Add Real Estate fund in late 2023, targeting a long-term net return of 10% a year.
The expansion of the real estate strategy comes as Border to Coast prepares for a potential expansion of its partner funds. Seven LGPS funds have entered exclusive discussions to join the pool, which could boost its assets to close to £110bn.
