The National Pension Service of Korea, one of the world’s largest investors in unlisted infrastructure, has invested an additional 7.76 trillion won (US$5.7 billion or €5.2 billion) in the asset class in 2023, according to its latest annual report.
This was a smaller amount than in the previous two years: NPS allocated 12.06 trillion won for infrastructure in 2022 and 8.95 trillion won in 2021.
According to its latest annual report, NPS has committed 66.93 trillion won to infrastructure by the end of 2023, of which 41.82 trillion has been executed or called by fund managers.
The investor – one of the world’s largest public pension funds with assets under management of 1.114 trillion won – also increased the number of infrastructure funds it has made commitments to from 219 in 2022 to 234 in 2023.
At the end of 2023, NPS’s alternative investment portfolio, which includes private equity, real estate and hedge fund investments in addition to infrastructure, amounted to 164.2 trillion won. This means that infrastructure (if the number of called commitments is used) accounted for just over a quarter of this portfolio (25.9 percent).
According to its annual report, its largest investments in infrastructure funds include 341 billion won in Antin Infrastructure Partners IV, 277 billion won in Global Infrastructure Partners IV, 258 billion won in Brookfield Infrastructure Fund IV (plus 222 billion won as a co-investment for that fund) and 248 billion won in Brookfield Infrastructure Fund V.
The pension fund strongly favors commitments to global funds, which accounted for 63.9 percent of its infrastructure fund commitments at the end of 2023. In what NPS considers “projects,” often separately managed accounts or direct investments, domestic commitments in South Korea account for 33.6 percent of that portion of the portfolio, closely followed by North America at 31.4 percent.
As is common for many Korean LPs, NPS strategically favors core-plus and core investments. Half of its portfolio consisted of core-plus assets, 29 percent of core assets, and around 18 percent were value-added infrastructure investments.
