Franklin Templeton has acquired three social infrastructure assets, following the launch of the Franklin Templeton Social Infrastructure Fund (FTSIF), a new impact investment fund focusing on social infrastructure investments across Europe.
By December 2018, the fund acquired its first three assets for its diversified FTSIF portfolio, which includes a justice courthouse in Madrid, a medical clinic in London, and an elderly care facility in a suburb of Milan.
Managed by Franklin Real Asset Advisors (FRAA), the fund raised €158.4 million ($181 million) in its initial closings in 2018. The investor base of eight European and Canadian institutional investors was led by VBV-Vorsorgekasse AG, a severance payment fund in Austria. The FRAA investment team has a robust pipeline of more than €500 million ($572 million) of investments and expects to transact several additional assets in the first quarter of 2019.
“There is a widening gap between what is needed to build and maintain adequate social infrastructure and the resources available to fund these projects,” said Raymond Jacobs, managing director and portfolio manager of the fund. “Public investment alone is not sufficient to fill this gap, and social infrastructure has emerged as an important, institutional-scale opportunity for private investors to align their portfolios with societal benefits and achieve competitive financial performance.”
FTSIF is an AIFMD-compliant, open-end unlisted fund investing in physical real estate assets that accommodate and facilitate social services, helping to build strong communities. The fund will invest in core, income-producing assets located in, or around, large communities in the European Economic Area, Switzerland and the United Kingdom. Examples of social infrastructure assets include healthcare and education facilities, social and affordable housing, and buildings related to justice, emergency and civic services.
