PM exposure: from £0 to £10bn AUM, with £8bn of new money; total exposure (including committed capital) ~33% of all assets
£3bn in the UK and growing; ~£4bn at wider partnership level
12 investment team members, from 5 at the beginning
162 private investments selected in total by the internal team
32 infrastructure coinvests, alongside 24 different sponsors; 9 in UK; 2 in natural capital
£150m committed to affordable housing since 2021; ~£600m by wider partnership
Stayed true to modest ticket sizes, to small- & mid-market funds
Encouraging early net returns results, in long-term asset classes
High level overview of deployment since launch:
From £0 – c.£10 billion in private market AUM in just 7 years, ~25% of total Brunel pool client assets
£8.0 billion of new capital invested and allocated since Brunel’s formation by our underlying clients to Brunel’s portfolios
£860 million invested in UK renewable energy & transition by the Brunel Portfolios on behalf of our clients, plus £330m by our clients directly via Wessex Gardens
£150 million into Affordable Housing since 2021 by Brunel Portfolios (UK Property & Cornwall Local Impact)
£1.6 billion of UK Property transferred to Brunel management
Number of portfolios and investments made:
24 distinct private market portfolios, across 6 assets classes, 4 vintages and 2 elective services including Cornwall Local Impact Portfolio
Selected 162 investments so far, across fund types (primaries, secondaries, coinvest) as well as direct coinvests and fund secondaries
Infrastructure investments made with a focus on UK renewables:
32 coinvests in Infrastructure projects and platforms, across all sectors – living up to the aims of Pooling set out in 2016 to improve returns, reduce fees and costs and gain more direct access for our clients by investing on behalf of 10 clients instead of one
9 UK coinvests
Coinvesting is saving our Infrastructure clients alone >£5m p.a.
£2.9bn invested & committed in Infrastructure, >80% of which is defined as ‘sustainable’; 54% (£1.55bn) of which in Renewables & Energy Transition assets globally (climate change is a global issue)
Our clients formed their own fund, Wessex Gardens: a further £0.3 billion into South-West located renewables
55% of all Renewables asset £ invested (£860m) in the UK, across onshore wind, offshore wind, solar PV, battery storage, interconnectors, green hydrogen, bioenergy from waste, heat networks
Scale allows large and innovative investments to be made:
Brunel cornerstoned a majority UK onshore wind fund in 2019 with £83m of £300m fund raise (Capital Dynamics Clean Energy 8)
Brunel cornerstoned the NextPower UK ESG fund with fellow LGPS
Brunel cornerstoned the Greencoat Renewable Income fund from its Secured Income portfolio, which has invested £1.1bn in >140 UK Solar farms, 3 offshore wind farms, 4 bioenergy assets and the largest UK heat network platform
Intrinsic to largest-ever secondary solar portfolio transaction in UK history – Toucan. This gave our clients access to 177MW of South-West-located operating solar assets to meet their local objectives as well as repaying Thurrock Council >£500m. This transaction was >50% financed by GRI and other Greencoat clients, along with our clients forming Wessex Gardens
Funding the 1st electricity interconnector from the UK to Germany – Neuconnect – alongside Meridiam
Coinvest in Somerset-based solar IPP, BSR, alongside a key equity sponsor partner of Brunel’s, ICG. BSR is targeting 60% biodiversity net gain on each project.
Coinvest in offshore wind turbine installation vessel company Havfram alongside Sandbrook, de-bottlenecking a key supply chain to future Renewable development
Investing in innovative infrastructure via Sidewalk Infrastructure Partners, developing future fit roads, carbon-negative data centres, plastics recycling, virtual power plants and next generation connectivity
Fibre broadband investments across regions via primary funds
Natural Capital investments as part of our mainstream 3rd Infrastructure vintage’s Climate Solutions portfolio – investing in sustainable forestry and agriculture:
Investing in organic farming with Clear Frontier, assisting traditional farms to convert to organic as well as sustainable agricultural practices and operating businesses. The soil has far greater capacity to absorb carbon than the atmosphere and trees. Natural Capital without a focus on soil is missing the biggest part of the solution.
Green shoots of affordable housing investment:
£150m invested into 1,365 English Affordable family houses and 321 apartments, across 29 schemes from Cornwall to East Yorkshire, with rents set at 22% of average local household income and EPC ‘B’ rating:
Creation of £65m Affordable Housing solution for Cornwall to invest locally in Cornwall
Plus, Brunel UK property portfolio investment into PGIM UK Affordable Housing of £85m alongside Greater Manchester and Merseyside as cornerstone anchor investors at first close
On their own behalf, to fulfil differing local impact objectives and with differing risk appetites, 4 of our underlying LGPS Clients (Wiltshire, Gloucestershire, Devon, Avon) have already collectively committed £445 million to 5 other Affordable, Social and Homelessness Housing funds. These sit outside of Brunel but show the great work done by our clients of their own volition
Other impactful investments from Brunel’s UK property portfolio:
£80m invested in the Octopus Healthcare Fund, providing high-quality care home residential accommodation
Cornerstoned with £78m invested in UBS Life Science Fund, investing in new UK Life Science labs, GMP and lab-enabled offices in Oxford, Cambridge, Stevenage and Potters Bar.
Cornerstoned the £78m committed to Orchard Street Social & Environmental Impact Fund
£77m invested into M&G UK Residential accommodation
Significant UK property investment pooled for a lower cost:
UK property assets of £2.4 billion across balanced, specialist and long lease property funds
Removed multi-manager fee layer for 8 Clients
Rationalised >140 property funds down to a focussed portfolio of 14 funds, investing in UK affordable housing, residential, care homes, life sciences, industrial, office – all with a keen focus on sustainability as shown by improving metrics over Brunel’s tenure
Investing in UK businesses via private equity:
Investing private equity in UK businesses of all sizes, across the capital spectrum via buyout, growth and VC investments at various stages. We have distinct UK primary buyout funds in each vintage portfolio as well as pan-European buyout and VC funds, Global Secondaries and coinvests:
Brunel’s Private Debt program has focused on lending to businesses via Direct Lending funds, providing senior first-lien and uni-tranche loans to mid-market companies.
Commitments have been made to 15 different funds managed by 12 different managers.
The total amount committed is approximately £2 billion, with around £1.1 billion already invested.
The portfolio includes over 500 underlying companies, representing a high level of diversification.
Approximately 20% of the total amount is directed towards the UK.
Focus on sustainability:
We have done all of this whilst building globally diverse, risk-aware, sustainability focussed portfolios. We have pioneered an approach to assessing the sustainability of our Infrastructure portfolios by extending the FTSE Green Revenue methodology from public markets to private, allowing better top-down views for our clients. 83% of our infrastructure capital alone is invested in Renewables and other assets classified as Sustainable, according to the the FTSE Green Revenues methodology developed by FTSE Russell, and adapted to Infrastructure by StepStone.
We have an industry-leading property sustainability assessment framework from which we can conclude that:
All of our chosen UK funds have Net Zero aspirations, nearly half with a fund target date earlier than 2050
Three quarters of UK funds have a fund road map, and nearly 70% of the UK portfolio’s assets have an asset road map to reach Net Zero
Over half of funds measure embodied carbon and have strategies to reduce this as part of developments and refurbishments
Half of funds have set targets for Scope 1 and 2 emissions in line with science-based net zero pathway
UK funds selected have been improving their EPC ratings: EPC A-C has increased from 61% in 2022 to 71% in 2024, while those assets rated D, G or unrated have decreased from 12% to just 4% in the same time period
100% of chosen UK funds publish a DEI strategy/policy, provide DEI training and track DEI metrics. Over three quarters set DEI targets and disclose DEI metrics
Within the international portfolio, over three quarters of funds have a corporate road map to net zero, and a third have a fund road map
All chosen international funds are UN PRI signatories, and over half are classified Article 8 on SFDR