The State of New Jersey Division of Investment will commit $200 million to TPG’s climate-focused impact fund, the pension has confirmed.
TPG Rise Climate has a $5 billion target and $7 billion hard-cap, according to documents prepared for the pension by investment consultant Aksia Torrey Cove. It will charge a management fee of 1.4 percent of committed capital during the commitment period, and 1.25 percent of “actively invested capital contributions upon the expiration of the commitment period”, the documents state. It has the standard 8 percent hurdle rate and 20 percent carry.
Shoaib Khan, acting director and chief investment officer for New Jersey Division of Investment, noted the firm’s “first mover advantage” in his recommendation to the State Investment Council. “Currently there are limited pools of private capital focused on climate-related investing,” wrote Khan. “Existing climate funds are mostly in the infrastructure or venture capital space. Conversely [TPG’s fund] seeks to create a more diversified investment approach by allocating capital flexibly across buyout, growth and structured equity to large-scale investment opportunities.”
The pension previously made commitments to both TPG’s Rise funds.