The London Fund was launched in January 2020 as a collaboration between two LGPS investment pools – the London Collective Investment Vehicle (LCIV) and Local Pension Partnership Investments (LPPI) – to enable London LGPS funds to access investment opportunities in three of the PBII pillars – housing infrastructure and SME finance – across the Greater London area and surrounds.

LCIV is the Alternative Investment Fund Manager responsible for risk management while LPPI has delegated responsibility for portfolio management. The London Fund combines the local knowledge of both parties which offers greater access to resources and a wider investment pipeline than could be achieved through individual management. LCIV and LPPI represent clients based in the Greater London region.

The Fund aims to deliver:

  • Competitive investment returns with a target return of CPI + 3%;
  • Positive social benefits including job creation, affordable housing, local area regeneration and positive environmental impacts;
  • 80% of the capital invested within London’s 32 boroughs (Greater London).

The Fund’s investment approach has been designed to ensure the delivery of positive social outcomes within the target geography. Each investment will be evaluated using ESG criteria and be expected to align with the London Quality of Life indicators published by the London Sustainable Development Commission. This includes themes such as decarbonisation, quality of housing and health outcomes. Investors will receive periodic reporting on the social outcomes delivered through the Fund’s investments.

The London Fund is aiming to raise £300-£500 million over several years from individual London-based LGPS funds. In December 2020, the the London Pensions Fund Authority (LPFA) provided a £100 million commitment, followed by an additional £50 million in March 2021.

March 2021 also included the fund’s debut investment in Delancey and Oxford Residential’s DOOR SLP (‘DOOR’) ‘build to rent’ housing platform which supports the development of new quality housing stock for London.

DOOR is a dedicated residential investment vehicle – part owner of Get Living, the UK’s leading build-to-rent operator of large-scale residential neighbourhoods. DOOR will facilitate The London Fund’s investment in housing developments in areas such as East Village, Stratford and Elephant and Castle. This includes almost 3,000 homes under management, 1,870 homes under construction, a further 3,500 in the secured pipeline, with an overall target of 15,000 homes within the next five years. Get Living’s institutional ownership, provision of long-term tenancies and resident-only break clauses provide residents with security of tenure.

This investment reinforces The London Fund’s focus on investment opportunities in real estate that includes the private rented sector affordable housing, regeneration schemes and specialist accommodation such as senior living and co-living.