Our Long Income strategy focuses on acquiring and managing assets that deliver secure, contractual income over extended durations. These assets are typically underpinned by high-credit-quality counterparties and structured to generate inflation-correlated returns with minimal reinvestment risk, making them well-suited for liability-aware institutional portfolios.

Strategy Focus

The portfolio targets real and contractual cash flows across a range of sectors and structures, including:

• Ground Rents & Income Strips:
  Long-dated leasehold interests with upward-only rental uplifts—typically CPI or RPI linked—underpinned by institutional-grade property.

• Sale & Leaseback Transactions:
  Acquisition of operationally critical assets from corporates or public bodies, structured with triple-net leases and strong covenant packages.

• Social & Core Economic Infrastructure:
  Long-term revenue exposure to social assets (e.g. healthcare, education) and regulated or availability-based infrastructure.

• Contracted or Regulated Cash Flows:
  Exposure to assets with statutory or long-term contractual payment regimes, including utilities, renewable energy PPAs, and concessions.

Investment Objectives

• Duration Matching:
  Provides predictable, long-duration cash flows that align with long-dated liabilities—particularly relevant for DB pension schemes and annuity writers.

• Inflation Linkage:
  Index-linked structures (CPI/RPI) or fixed uplifts embedded in lease agreements mitigate purchasing power erosion and duration mismatch.

• Capital Preservation:
  Emphasis on seniority in the capital structure, high asset quality, robust covenant packages, and residual value underpins downside protection.

• Yield Enhancement with Low Volatility:
  Delivers illiquidity premium and spread over sovereigns or inflation-linked gilts, while exhibiting low beta to traditional risk assets.

Risk Management Framework

• Counterparty Risk Monitoring:
  Continuous credit assessment and diversification across sectors and obligors mitigate exposure to individual lessee default.

• Structural Protections:
  Investment structures include full-repairing and insuring (FRI) leases, step-in rights, collateral packages, and rent deposit mechanisms.

• Liquidity & Exit Strategy:
  While inherently illiquid, secondary market liquidity is considered in underwriting, and portfolio construction reflects varying exit horizons and cash flow waterfalls.

Portfolio Role

Long Income Assets are increasingly core to constrained portfolios, offering:

• Stable, forecastable real returns over multi-decade horizons

• Diversification from public market volatility

• Regulatory capital efficiency and duration hedging benefits

• ESG-aligned exposure through social infrastructure and green leases