The strategy aims to offer investors access to inflation-linked returns from a portfolio of “perpetual” infrastructure core assets, while also creating growth in the real economy.
More than half the strategy will be allocated to Europe initially, with a global focus becoming prominent “over the decades to come”, with a range of open-ended vehicles planned for the second half of 2022.
Principal launches Article 9 sustainable infrastructure fund
It will target a range of investments across energy transition and security, including digital and community infrastructure, sustainable mobility and the circular economy.
On a granular level, this includes investments in utilities and end-to-end renewable energy infrastructure, data centres, grid digitisation, batteries and natural gas storage which can be adapted for hydrogen.
Edwin Conway, global head of BlackRock Alternative Investors, described the “intersection of infrastructure and sustainability” as one of the biggest opportunities of the coming years.
“At the same time, recent events have sharpened the focus on energy security and further compounded the need for infrastructure investment,” he added. “Private markets will continue to play a pivotal role in the energy transition, and we are pleased to offer our clients another way to go beyond simply navigating the transition to driving it forward.”