Wales Pension Partnership makes real estate debt investment

The Local Government Pension Scheme (LGPS) pool said it would provide capital ringfenced for deployment in Wales and was targeting an initial £30m of lending in 2025 - with a focus on funding housebuilders and developers to deliver much needed local, affordable housing.

WPP will invest through Pluto Finance's local impact programme, which allows LGPS funds and pools to deliver meaningful placed-based investment and local impact, while maintaining their diversification to a national loan portfolio.

Pluto said the pool's commitment would particularly supports small and medium-sized housebuilders, a sector which it said was struggling to access bank funding after recent regulatory changes.

The private debt provider said such investments were a "critical component" in the government's plan to build 1.5 million new homes – with the ability to recycle investments having a compounding effect on the number of new homes built.

Pluto said, through its investment, WPP would be able to support "tangible impact" to Welsh communities through the delivery of much needed affordable homes – directly driving regional economic growth, local regeneration and SME job creation.

Commenting on the appointment, WPP joint governance committee chair councillor Elwyn Williams said: "The WPP is committed to providing productive capital into Wales and we are delighted to have found a solution that delivers both in financial and local impact terms. This investment made through our private debt allocator, Russell Investments, will look to support both the Welsh economy and the affordable housing needs of our local community."

Pluto Finance head of UK investor solutions Ashley Manning-Brown added: "We are thrilled to be working with the Wales Pensions Partnership, to help them deliver a step change in local, affordable housing. By utilising our innovative approach to place-based investment, the WPP will be supporting local communities and their housing needs, while delivering investment and SME job creation into the region."

WPP is a collaboration of the eight LGPS funds serving Wales – Cardiff and Vale of Glamorgan, City and County of Swansea, Clwyd, Dyfed, Greater Gwent (Torfaen), Gwynedd, Powys and Rhondda Cynon Taf.

Pluto Finance offers a range of funding options, including bridging, development and investment finance, tailored to meet the needs of its clients. Since its launch in 2011, Pluto vehicles have lent over £3bn, facilitating the development of more than 12,000 new homes.

This loan book is funded by major institutional investors, including pension funds, local government pension schemes and insurers.

The Universities Superannuation Scheme, the UK's largest pension scheme, is an investor and a part owner of the business.