DWS Raises $340 Million for Sustainable Infrastructure Fund
German asset management firm DWS Group has announced that it has raised €323 million (USD$340 million) at the first close of its ESG Infrastructure Debt Strategy (EIDS), aimed at investing in senior secured debt for projects and corporate borrowers operating across sustainability-themed sectors such as renewable energy, energy efficiency and utilities, digital infrastructure, clean transportation, and circular economy projects.
DWS added that it is aiming to raise €500 to €750 million for the sustainability-focused infrastructure strategy. EIDS is DWS’s second senior European infrastructure debt series, following the deployment of more than €850 million under the first vintage.
Benjamin Schmitt, Director Infrastructure Debt at DWS, said:
“The second iteration of our European senior debt strategy enables institutional investors to invest into a diversified portfolio of debt investments offering stable yield income, downside protection as well as supporting the build-up of resilient and sustainable infrastructure in Europe.”
The firm said that the EIDS has garnered strong support from institutional investors in the EMEA and APAC regions, and targets senior infrastructure debt investments with a focus on continental Europe and sustainable infrastructure assets, with a focus on directly negotiated transactions and mid-market private debt financing. The firm called the close an “important milestone,” enabling it to continue to expand its presence in the European infrastructure debt market with a strong focus on green and social infrastructure investments as well as sustainability-linked-loans.
Sundeep Vyas, Head of Infrastructure Debt Europe at DWS, said:
“Infrastructure debt as an asset class continues to draw strong investor interest due to good risk-adjusted returns, attractive illiquidity premiums and a strong pipeline of investment opportunities.”
EIDS aims to achieve a target gross return of 5.5-6.5% per annum, with an annual distribution target of 5.0-6.0%. At least 50% of the fund’s investments will be aligned with the EU Taxonomy while the strategy is designed to meet the reporting requirements under Article 8 of the EU Sustainable Finance Disclosure Regulation (SFDR), the firm said.