German real estate investment manager HIH Invest has decided to join the wave of its peers dipping their toes in infrastructure with the launch of its HIH Green Energy Invest fund, our colleagues at affiliate title Infrastructure Investor report (registration required).
The Article 9 vehicle is targeting €750 million and aims for “an average net cash-on-cash return of 5.5 percent”. It is set up under Luxembourg law.
The fund will invest in photovoltaics and onshore wind power projects already in, or close to, operation. Ticket size ranges from €20 million to €120 million and Germany, France, Italy and Spain are favoured. The life of the fund is 30 years.
To handle this new asset class, HIH has set up a team led by Kristof Krull, a former MD at renewable energy specialist WOC Asset Management.
“What makes this a reasonable target are not least the perfectly predictable revenues: Solar irradiation and wind force can be reliably forecast, power-purchase agreements have long terms, and the demand for electricity is growing,” said Krull in the launch announcement.
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