Swiss Life Asset Managers is on course to surpass its target for the third vintage of its Switzerland-focused sustainable energy infrastructure fund, Infrastructure Investor has learned.
Clean Energy Infrastructure Switzerland 3 (CEIS 3) is a closed-end fund launched in November 2022 with a target of SFr1 billion ($1.25 billion; €1.1 billion).
The vehicle is a partnership between Swiss Life AM (51 percent) and UBS Asset Management (49 percent) to provide Swiss institutional investors with exposure to Swiss Francs-denominated infrastructure investments.
Christoph Gisler, head of infrastructure equity at Swiss Life AM, said the vehicle is poised to reach final close above its SFr1 billion target at the end of October.
“CEIS 3 will be the largest closed-end Swiss infrastructure fund that has ever been raised,” he said.
Gisler highlighted the strong support from the manager’s existing investors, resulting in a high re-up rate.
“There’s a very high level of investors who committed in addition to their existing exposure to UBS-CEIS 2,” he said.
He added that some sponsors, already aware of the manager’s CEIS fund series, were spurred to broaden their investment exposure to include infrastructure.
Fund performance
CEIS 3’s latest fundraising milestone is the culmination of a robust capital raising process.
The fund reached its first close on SFr772 million in November 2022 – at the same time as its launch. This seed capital was drawn from a diverse pool of 38 institutional sponsors during the vehicle’s pre-marketing phase.
Significantly, the first close alone exceeded the total capital raised for each of the strategy’s predecessors.
CEIS 3 proceeded to amass SFr936 million for a second close in December 2024.
Swiss Life AM, however, has not been unaffected by the headwinds in the fundraising market, as the pace of its second close illustrated.
The fund deploys a core and core-plus strategy to invest primarily in private, Swiss infrastructure assets.
These investments are spread across renewable energy, energy efficiency, energy infrastructure and decarbonisation sectors.
Investments will also cover utilities, transport and telecoms, power plants and grids, district heating networks, waste and recycling plants, water infrastructure and energy storage projects.
The fund is targeting a 5 percent net IRR in Swiss Francs.
Gisler said that this returns profile is equivalent to 7-7.5 percent net IRR in euros and approximately 8-8.5 percent in US dollars.
Predecessor funds
The fund’s predecessor, UBS Clean Energy Infrastructure Switzerland 2 (UBS-CEIS 2), was a joint venture between UBS, Swiss manager Fontavis and Swiss Mobiliar.
The CEIS fund series came under Swiss Life AM’s management following its purchase of the specialist sustainable infrastructure manager Fontavis in 2019.
UBS-CEIS 2 held a final close with commitments of SFr472 million in September 2019 – exceeding its SFr450m target.
The vehicle attracted investments from 40 institutional sponsors, spanning private and public pension schemes as well as insurance companies.
“These were mainly domestic, Swiss Franc-[denominated] institutional investors. But there were some international investors with Swiss links,” said Gisler.
He explained that a key benefit for sponsors was that the fund offered exposure to Swiss Franc-denominated infrastructure assets, helping to match against their long-term liabilities, which are also held in Swiss currency.
The first fund in the series, UBS Clean Energy Infrastructure Switzerland, was launched in November 2013 with a target of SFr500 million. It closed on SFr396 million from 13 investors in 2016.
A key driver for establishing the fund was to contribute to renewable energy production in Switzerland and safeguard the country’s energy supply, in line with the Federal Council’s Energy Strategy 2050.