Alpha Real Capital unveils 'low risk' European long income fund

Long income real asset specialist Alpha Real Capital has launched the European Long Income Fund (ELIF).

According to Alpha, the fund will target Euro denominated, asset backed, secure inflation-linked income streams by investing in commercial ground rents, amortising income strips and long lease property, such as sale and leasebacks.

With an initial focus on Germany, the Netherlands and Ireland, ELIF is a Luxembourg-domiciled fund open to institutional investors.

Alpha said that the fund had secured a major investment from Willis Towers Watson’s European Secure Income Fund (ESIF,) with strong interest from European pension funds and insurers seeking secure long-term income to match their liabilities.

'With nominal yields in northern Europe forecast to be close to zero or negative for the long term, we believe that secure income derived from long income property is an increasingly attractive asset class for European pension funds and insurers,' said Hugo James, partner and head of Long Income.

'The fund’s strategy is focused on commercial ground rents and amortising leases. We believe these structures can offer new and attractive funding solutions to owners and acquirers of operational real estate,' James added.

This focus is intended to place ELIF at the lower end of the risk spectrum, offering a key differentiator to other long income property funds, the firm added.

Scott Gardner, partner investment capital, said: 'Alpha has responded to increasing demand from European pension funds, insurance companies and their investment consultants to undertake a secure income strategy in Europe following our success in the UK.

'Our knowledge of what drives these investor segments along with our European presence and unique approach to origination makes us an attractive partner for large asset backed operating businesses. We expect to see considerable European growth in this strategy.'


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