Delivering positive outcomes
Global warming is one of the greatest challenges of the modern world. The scale and urgency of change needed to ensure global greenhouse gas emissions are aligned with a 1.5 degrees Celsius pathway will impact every part of the global economy. As a committed investor, acting and supporting the transition to a low-carbon and climate-resilient world is fully consistent with our values.
Through the Climate Transition Real Assets Strategy, we provide investors access to an actively managed, diversified portfolio of real assets oriented to the transition to a low-carbon economy.
Why invest?
Our approach to investing in the climate transition encompasses a variety of strategic real asset investments which aim to capitalise on climate thematics and maximise long-term return opportunities.
Dual targets*
Investing to accelerate the climate transition and aiming to deliver 8% IRR net of fees and net zero by 2040.
Direct control
Direct investment in real assets in order to drive financial and environmental performance.
Multi-asset
Portfolio construction based on identifying relative value across pan-European real estate, low-carbon infrastructure and nature-based solutions.
*The financial return is not guaranteed and may not be sustained. The Fund’s net zero target may not be achieved.
Transitioning to a low-carbon economy
Portfolio Manager Zoe Austin and Luke Layfield, Head of Portfolio Management, Private Markets, discuss how investing in low-carbon real estate, infrastructure, and nature-based solutions can enable investors to capitalise on the growing demand for climate-friendly assets.
Transcript for video Transitioning to a low-carbon economy
Portfolio Manager Zoe Austin and Luke Layfield, Head of Portfolio Management, Private Markets, discuss how investing in low-carbon real estate, infrastructure, and nature-based solutions can enable investors to capitalise on the growing demand for climate-friendly assets.
Explore fund performance and key data
Find the latest prices and performance data in our fund centre via the links below. If you have any questions, please contact our distribution team.
Aviva Investors Climate Transition Real Assets Fund
The fund aims to deliver an overall GBP return (net of fees) of 8% per annum on a rolling 5-year basis, through income and capital growth from a diversified pan-European portfolio of direct real assets focusing on climate transition.
Investment philosophy
Managed by a team from across our private markets platform, the strategy adopts a multi-asset approach and applies a robust asset allocation process.
Avoid emissions via infrastructure
Focus on low-carbon infrastructure, renewable energy and digital infrastructure including solar, onshore wind and fibre.
Reduce emissions via real estate
Focus on real estate refurbishments and developments to reduce energy and carbon intensity.
Remove emissions via natural capital
Investing directly in nature-based solutions including afforestation and sustainable forestry to inset emissions and deliver carbon removals.
Align emissions via private equity
Focus on private equity investments that align the portfolio with nascent climate technologies.
Looking beyond simple solutions
Building better: Opportunities for DC schemes to invest in the climate transition through real assets
By investing in climate-aligned real assets, defined-contribution pension schemes can help propel the transition to a more sustainable future while also benefiting from portfolio diversification and attractive risk-adjusted returns, says Mark Meiklejon.
Real assets in a shifting landscape
Demand remains strong, but the investment drivers are changing. At a time of macroeconomic uncertainty, real assets continue to play a significant role in the investment strategies of global institutions. The sixth edition of the Aviva Investors Real Assets Study is our biggest yet and seeks to answer some key questions.
Aviva Investors Climate Transition Real Assets: Fund-in-brief
The fund aims to deliver an overall GBP return (net of fees) of 8% per annum on a rolling 5-year basis, through income and capital growth from a diversified pan-European portfolio of direct real assets focusing on climate transition.
Investment insights
Investment thinking that brings together the collective insight of Aviva Investors’ teams from across the globe on the key themes influencing markets.
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Five things you need to know about LTAFs: Lessons for investors in UK private markets
30 Sep 2024
In November 2021, regulatory changes were introduced in the UK to help facilitate investment into private asset classes. This article on Long-Term Asset Funds (LTAFs) captures five things defined contribution pension schemes should know about progress so far.
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Only connect: How a holistic approach to investment stewardship can enhance client outcomes
27 Sep 2024
From direct investments and engagement with companies to dialogue with governments and regulators, we believe stewardship efforts can deliver better outcomes for clients.
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Get networking: Will the next decade be a golden age for UK infrastructure?
3 Sep 2024
While there are obstacles to overcome, the coming years could see new opportunities for the UK government and the private sector to work together on infrastructure projects, says Darryl Murphy.
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Real asset stories: Curtain House
8 Aug 2024
In the first instalment of a new series of case studies on our real asset investments, we look at Curtain House, a Victorian warehouse Aviva Investors is converting into a modern, environmentally friendly office building.
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Boosting low-carbon investment in the UK: A Policy Roadmap
16 Jul 2024
Our in-depth Roadmap for the UK’s journey towards a low-carbon economy contains policy recommendations to unlock private investment in the transition.
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The future of green premia in real estate, part two: Searching for value and resilience
8 Jul 2024
Do energy-efficient buildings have more pricing power, and what could that mean for those investing in the built environment? We bring together the views of leading capital markets researchers, a valuer and an asset manager for the second part of our deep dive into green premia, analysing the investment implications.
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Avoid, reduce, remove, align: Finding climate transition investment opportunities in real assets
3 Jul 2024
In this article, Luke Layfield and Zoe Austin explain four key pillars that can help real asset investors align their strategies with the climate transition and uncover opportunities to deliver attractive returns.
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The future of green premia in real estate, part one: The view from the ground
27 Jun 2024
Do greener buildings have more pricing power, and if so, how much? We bring together the views of leading capital markets researchers, a valuer and an asset manager for a two-part deep dive on the latest market dynamics.
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Blueprints for a greener economy: Creating a transition planning ecosystem
25 Jun 2024
National transition plans can give investors support, confidence and direction to accelerate the flow of finance to bring about a low-carbon economy. As such, they should be seen as a strategic opportunity.
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Nothing to fear: Sustainable investing trade-offs
19 Jun 2024
Sustainable investing, and the supposed trade-offs involved, have been a topic of heated debate. But trade-offs are a fundamental part of all types of investment; the key is to be clear about your objectives, as Mirza Baig explains.
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See the wood, not just the trees: How climate-focused credit investors can help drive real-world change
14 May 2024
Green bond funds and Paris-aligned benchmarks are aimed at climate-focused credit investors who also want the simplicity of passive investing. But while they decarbonise portfolios, they exclude the companies in the real economy that need to transition if the world is to meet the Paris Agreement goals. This is why an active approach can be beneficial.
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Building better: Opportunities for DC schemes to invest in the climate transition through real assets
22 Mar 2024
By investing in climate-aligned real assets, defined-contribution pension schemes can help propel the transition while also benefiting from portfolio diversification and attractive risk-adjusted returns, says Mark Meiklejon.
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The war on bugs: Climate change contributes to growth in the pest-control industry
13 Mar 2024
Pest control has become a growing priority for city residents and authorities all year round, as rising temperatures and other factors boost the populations of many pest species. But in creating adaptation solutions, the sector could also represent a long-term investment opportunity.
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Credit spreads and climate solutions: The outlook for climate-focused bond investors
8 Feb 2024
For the first time in three years, interest rates should no longer be a headwind for credit markets in 2024, but other forms of uncertainty may affect climate-aware bond investors. Our credit experts discuss the key themes they expect to play out over the coming months.
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Common ground: Earning a social licence to operate in real asset investing
18 Jan 2024
Successful real asset investing requires acceptance of asset managers’ practices and procedures from a variety of stakeholders. We explore what this means for managers, their clients and investment outcomes.
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Plus ça change…The outlook for infrastructure debt in 2024
11 Jan 2024
Infrastructure demonstrated characteristic resilience in 2023 in the face of significant macroeconomic headwinds. Darryl Murphy from our infrastructure team explains why he expects current themes to persist in 2024.
Building better: Opportunities for DC schemes to invest in the climate transition through real assets
By investing in climate-aligned real assets, defined-contribution pension schemes can help propel the transition to a more sustainable future while also benefiting from portfolio diversification and attractive risk-adjusted returns, says Mark Meiklejon.
House View
No one can predict the future. But our quarterly House View sets out the collective wisdom of our investment teams on the current state of global markets – and where they might be heading.
Key risks
For further information on the risks and risk profiles of our funds, please refer to the relevant KIID and Prospectus.
Investment risk: The value of an investment and any income from it can go down as well as up and can fluctuate in response to changes in currency and exchange rates. Investors may not get back the original amount invested. Past performance is not a guide to future returns.
Immovables risk: The Fund will seek exposure to immovables, for example real estate, infrastructure and rural property asset, which have the following inherent risks:
Illiquidity risk: Immovables are inherently illiquid and the Fund should not be considered suitable for investors with a short-term investment outlook. Assets may not be readily saleable and the Fund operates limited redemption arrangements - please see ‘Dealing Arrangement Risk’ and ‘Suspension Risk’ below.
Valuation risk: Immovable valuations are subject to uncertainty and are a matter of opinion – they may contain subjective elements and are unlikely to be based on a public market price. There is no assurance that estimates resulting from the valuation process will reflect the actual sales price even where a sale occurs shortly after the valuation date.
Availability risk: Identifying and structuring immovable transactions is competitive and involves a high degree of uncertainty and consequently amounts subscribed by investors may not be fully drawn down or invested.
Real Estate risk: The Fund’s performance will be adversely affected by a downturn in property market capital values or weakening rental yields. Property values are affected by interest rates, economic growth, fluctuations in property yields and tenant default, and on the realisation of the investment, the Fund may receive less than the original amount invested. If tenants default, the Fund will suffer a rental shortfall and likely incur additional cost maintaining, insuring and reletting the property. Certain significant expenditures must be met when the property is vacant.
Development and construction risks: The Fund may be exposed to investments involving purchase of land for development and require permissions/licenses and permits to be obtained first - the Fund may receive little or no income during this time. There may also be delays in the administration of these requests and there is also the risk the relevant authority refuses to grant them.
Rural Property Assets: The Fund may be exposed to rural property assets, for example, including agricultural land and forestry, such investments are subject to physical, economic and political risks. Physical risks include natural disasters (fire, windthrow, storms), pests and diseases; economic risk include crop and timer market price and supply and demand risk; political and regulatory risk includes changes in public subsidy, grants and fiscal regimes.
Investment in other funds (including unregulated funds) risk: The Fund will assume any specific risks of the funds into which they invest. Extra costs may be incurred - in addition to fees and expenses levied by the Fund, charges may be levied by the underlying funds. Investments in unregulated funds are subject to less restrictive rules, they can use higher risk investment techniques and may borrow to invest. They are also valued less frequently and there is a risk that any market movements will not be reflected in the daily price of the Funds and that investors may miss out on unrealised profits from underlying investments. Liquidity of unregulated funds is not assured and cannot be relied upon to meet redemption requests as and when made. Lack of liquidity may affect the value and lead to units being suspended.
ESG risk: Investing on basis of ESG factors may limit the choice of investments and performance of the Funds may be impacted (either positively or negatively).
Dealing arrangement risk: Investors will be required to sign up to an agreement, committing to subscribe an amount to the Fund, but such amounts will only be drawn down from investors at the discretion of the Fund and units will only be issued to investors, based on the prevailing net asset value, at that point. The Fund operates limited redemption and deferral provisions, the proceeds of redemption will be calculated and settled subject to a notice period. Consequently, there may be a significant time lag between instructions being accepted and processed, and investors will bear the risk of any unit price movements in these periods.
Suspension risk: Limited redemption and deferral provisions may not fully reflect the time needed to sell assets in which the Fund invests. In exceptional circumstances and with the prior agreement of the Depositary the Fund can suspend all dealing until the exceptional circumstances have ceased.
Infrastructure Risk: Infrastructure investments may include transportation services, the production and delivery of energy, and technology. The Fund will be exposed to infrastructure related risks such as: changes in planning laws, credit risks of tenants and borrowers and environmental factors. Infrastructure may be more susceptible to adverse economic, political or regulatory changes, and business operations may be adversely affected by additional costs, competition, and regulatory implications.
Net zero and carbon removal certificates: To formally offset carbon emissions carbon removal certificates have to be formally retired and once this happens, they cease to have value. This means when the certificates are retired this will impact financial performance.
Investments outside of commitment queues: Potential unitholders may be impacted by elongated timescales for drawing down commitments into the Fund and the Fund may experience cash drag, impacting on returns.
Real assets expertise
Meet our climate transition real assets investment team.
Luke Layfield
Head of Portfolio Management, Private Markets
Zoe Austin
Portfolio manager
Explore
Real assets
As one of Europe’s largest real assets investment managers, we have the scale to access the full depth and breadth of real asset markets. Find out more about our other real assets capabilities.
Pensions
Our deep heritage in managing assets for pension schemes allows us to better understand your investment objectives and deliver meaningful outcomes. Find out more about our pensions capabilities.