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Aviva launches long-term real estate transition fund

21st March 2024

Aviva Investors has created a new long term assets fund (LTAF) investing in sustainable real assets.

The UK investment manager converted the Climate Transition Real Assets Fund (CTRAF), which makes direct investments in real estate, infrastructure and nature based solutions which can accelerate, and benefit from, the transition to a low-carbon economy, to the LTAF regime.

LTAFs are a new form of UK open-ended fund designed to align investor interests with the holding of long-term, illiquid assets.

CTRAF was launched in 2021 with £425 million ($544 million) of equity and up to £1 billion ($1.28 billion) spending power. It is targeting an 8% annual return.

Daniel McHugh, chief investment officer at Aviva Investors, said: “As one of the UK’s largest investors in real estate and infrastructure, we remain committed to our belief that sustainability can drive long-term performance for real assets portfolios. 

“Our research shows investors are looking for access to investments that deliver long-term performance whilst being aligned with net zero commitments. By converting our Climate Transition Fund to an LTAF structure, we believe we have a product that is market-leading in both those areas, providing opportunities to invest in exciting growth sectors which support the UK economy and its transition towards net zero, whilst maximising the investment outcomes of people saving for retirement.”

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