Korean institutions commit $700m in Brookfield Infrastructure fund

[THE INVESTOR] Major Korean institutional investors have invested some 800 billion won (US$ 689 million) in one of the biggest private equity-style infrastructure vehicles.

Six large institutions including Teachers’ Pension and Public Officials Benefit Association have committed to the new global infrastructure fund by Brookfield Asset Management, a Toronto-based asset manager.

The move comes as investors allocate more to the asset class amid low fixed-income yields. 

“Institutions which seek to feature a higher proportion of alternative investments in their portfolio are showing high interest in infrastructure investment,” a source working in the investment banking industry said.

Brookfield expects to hit the self-imposed $14 billion cap for Brookfield Infrastructure Fund III LP by the end of June. The firm has raised US$11.8 billion for the fund so far.

Other investors in the fund include New Mexico’s pension fund, Oregon Public Employees Retirement System and some sovereign wealth funds.

The fund aims to generate an annual return of 13 percent by investing in infrastructure assets in major regions around the world including North America and Europe.

By Park Han-na (hnpark@heraldcorp.com)