BlackRock has held a first close on its UK Strategic Alternative Income Fund, which will invest in real estate debt, among other asset classes.
The offering has raised £500 million (€564 million), according to a company announcement.
The fund is being billed as a semi-open-ended product. After an initial four-year lock-up period, the vehicle will allow investors to withdraw capital each year during a liquidity window. A spokesman for BlackRock did not respond to inquiries regarding how this would affect the performance of the fund.
The fund is aiming to provide an annual yield of 5 percent. The product will achieve this through investments in infrastructure debt, renewable energy, long-lease property, private credit and real estate debt.
The fund is also expected to hold another round of fundraising during the next six to 12 months. The firm’s spokesman did not respond to questions regarding whether the fund had a target for capital raised.
“This fund was specifically designed for UK institutional investors, making it possible for them to access a broad, actively managed private market investment portfolio,” said Andrew Stephens, managing director for BlackRock’s UK institutional business.
“UK pension schemes in particular are facing the triple threat of underfunding, a poor forward looking return environment from traditional assets and increasing cash flow negativity. They are also ideally positioned to benefit from allocations to private market assets, given their longer term investment horizons,” Stephens added.
BlackRock recently launched its first Asia-domiciled private credit fund. The firm is looking to raise between $300 million and $500 million for the offering.