Aviva Investors launches £1.5bn LTAF

Largest UK-focused long-term asset fund to date

Daniel McHugh, Aviva Investors real assets CIO

Aviva Investors has launched a long-term asset fund (LTAF) with a ready-made £1.5bn portfolio.

It is the largest strategy in the LTAF sector since the fund category was given the regulatory greenlight in October 2021.

Open to institutional and professional investors, the Aviva Investors Real Estate Active LTAF (REALTAF) consists of direct real estate assets seeded by Aviva UK Life.

LTAFs are regulated open-ended investment vehicles designed to enable a broader range of investors, with longer-term horizons, to invest efficiently in illiquid and private assets.

Schroders was given approval by the FCA to launch the UK’s first LTAF in March.

Daniel McHugh (pictured), Aviva Investors real assets CIO, said: “As one of the largest investors in UK real estate we are thrilled to bring REALTAF to the market. It represents the largest LTAF on offer today for wealth and institutional investors, and one we want to make the go-to fund of choice for investment in real assets.

“We are also pleased to have the backing of Aviva UK Life in creating a fund which we believe represents the future of real assets investing. Not only does this demonstrate our ability to innovate and provide new products to meet the evolving demands of the market, it also shows the confidence we have to consistently originate assets, at scale, whilst matching investors’ underlying liquidity requirements.”

‘Positive change’

The strategy will incorporate sustainability considerations as part of its investment process, with Aviva regularly reviewing ongoing carbon emissions generated by buildings across the REALTAF portfolio to help inform asset allocation decisions.

Pierre Biscay, head of customer investments at Aviva UK Life, added: “As one of the largest investors in the UK, Aviva has the power to create a huge amount of positive change. We already invest a substantial amount into the UK and its communities by financing offshore windfarms and social housing schemes, improving the energy intensity of the built environment, funding restoration, carbon capture and woodland creation schemes.

“All of this supports our aim to help the UK become climate ready. We believe this new fund can help us do even more, making the most of the investment expertise of the Real Assets business and its ability to find projects that can deliver long-term value for our With-Profits customers, us as a business, and for the UK.”

See also: FCA mulls broadening retail access to LTAFs

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