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NYSCRF makes the largest ever known commitment to an impact fund

Brookfield’s Global Transition Fund has raised $750m from the New York State Common Retirement Fund – eclipsing commitments of $300m from the New Jersey Division of Investment and Pennsylvania Public School Employees' Retirement System.

Andrew Siwo, New York State Common Retirement Fund

New York State Common Retirement Fund has committed $750 million to the Brookfield Global Transition Fund – the largest ever third-party investment in an impact fund that New Private Markets knows of.

Other investors in the fund include the New Jersey Division of Investment, which invested $300 million in the fund and committed a further $300 million in a co-investment sidecar, and the Pennsylvania Public School Employees’ Retirement System, which also invested $300 million. Brookfield has committed $2 billion of balance sheet capital to the fund. The firm is set to announce a final close of the vehicle at its $15 billion extended hard-cap – just over a year after it launched. It is targeting a 10 percent IRR. Brookfield has set its sights on building a $200 billion energy transition strategy, managing director Natalie Adomait said in a recent earnings call.

NYSCRF is not new to writing cheques of this size: it has made 15 investments of $500 million or more in the past five years across private markets asset classes, according to PEI Media’s database. Among its impact fund commitments are $150 million to the Apollo Impact Mission Fund in December 2021 and $300 million to KKR’s Global Impact Fund in 2018.

NYSCRF, which has a portfolio worth $280 billion, made the investment in Brookfield’s fund out of its real assets bucket. The pension fund is in the process of increasing its real assets allocation from 1.5 to 3 percent. It is also establishing a $20 billion Sustainable Investments and Climate Solutions portfolio to invest across public and private asset classes under director Andrew Siwo.

NYSCRF has more than $11 billion in committed capital to sustainable investments, “several of which are impact investments”, Siwo told New Private Markets last year. “SICS represents a tapestry of investments that are loosely tied to the UN Sustainable Development Goals. Across the globe, we target nine themes split equally into three categories: human rights and social inclusion (eg, health and wellbeing); climate and the environment (eg, pollution and waste management); and economic development (eg, affordable housing).”

Other fund managers in New Private Markets’ Impact 20, a ranking of largest managers of private markets impact capital by funds raised in the past five years, that have drawn large individual third-party commitments include TPG, KKR, LeapFrog and Meridiam. After NYSCRF’s commitment to Brookfield, the second largest commitment to an Impact 20 fund was the Washington State Investment Board’s $400 million commitment to TPG’s Rise Climate fund.

Do you know of any other large commitments to impact funds? Email snehal.s@peimedia.com.