Amundi kicks off international debt investing for UK state-backed pension scheme

Amundi’s real estate debt business has started deploying capital for Nest, the UK’s largest defined contribution pension scheme.

Bertrand Carrez, Paris-based Amundi’s head of real estate debt, told PropertyEU this week that his team expected to close a first US investment ‘in the coming days.’

The loan will be a $20 mln-$30 mln participation in a circa $260 mln facility for the owner of a large San Francisco office building. The arranging bank is Crédit Agricole CIB; Crédit Agricole Group is Amundi’s parent company.

Nest (the National Employment Savings Trust) appointed Amundi last September with a mandate to invest an initial £100 mln but with the expectation this volume will rise rapidly to between £400 mln and £500 mln within three years.

The UK state-backed pension scheme is taking in contributions at the rate of £450 mln a month and, like other managers, Amundi will be allocated capital monthly and according to its investment pipeline. Nest also awarded a mandate last September to BlackRock, to invest in private infrastructure debt.

Like other large pension funds, Nest is allocating for the yield premium from private credit over traditional fixed-income investments.

The Nest real estate debt mandate is mainly for investments outside the UK, in Europe, the US and also Asia. ‘We also have a pocket to do some CMBS to bring some liquidity into the portfolio, so it’s quite a multi-strategy mandate’, Carrez said.

He said Amundi continues to be able to source loans at sub 60% loan-to-value at margins close to 250 basis points via its access to the banking market and cherry-picking deals.

Since launching the Amundi real estate debt platform two years ago with a mandate to invest in European senior loans from Crédit Agricole Assurances, Amundi has won two more separate accounts for senior debt: one for €100 mln on behalf of a Belgian insurance company; the other for an historical close relationship of Amundi, for several hundred million euros and to invest in large ticket sizes.

Fund-raising is ongoing for the Amundi Commercial Loans Fund. Of €250 mln of capital raised so far, €200 mln has been invested in seven loans in France, Spain, the Netherlands and Italy. A final close on a total of €400 mln is expected by the summer.

Carrez said the loans have been arranged by a number of different banks including Natixis, BNP Paribas, HSBC, SocGen and ABN Amro as well as Crédit Agricole CIB.

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