Long-term capital into productive assets - Sequoia Economic Infrastructure Income Fund Limited

Long-term capital into
productive assets

We focus on mature, investment grade rated jurisdictions that offer stable legal frameworks, with higher degrees of political and economic transparency including: North America, UK, Western Europe, Australia and New Zealand. We have limits on our maximum exposure to each geography in order to maintain our portfolio diversity.

Diversified across sectors and sub-sectors

Our investments are spread across 8 sectors and 25 sub-sectors, reducing exposure to any one sector or business cycle. We invest in defensive sectors that provide essential services, often operating within a regulated or contractual framework or have high barriers to entry.

Private vs public debt

We capture the enhanced returns offered by private debt investments (the “illiquidity premium”), alongside select exposure to publicly traded debt to increase the portfolio diversification and liquidity

Operational projects

We predominantly invest in operational projects with a proven track record and stable cash flows. Lending to projects that are pre-operational is limited to no more than 20%.

Credit quality

Senior debt accounts for at least half of the portfolio with enhanced risk-adjusted returns from mezzanine and holdco debt investments, providing a mix of strong credit security and attractive income. All investments are supported by the protection of an equity cushion of typically 20% or more, to absorb any unexpected losses.

Active risk mitigation

Interest rate risk: Over half of the portfolio is floating rate or index-linked to mitigate interest rate risk.

FX hedging: We hedge substantially all of our capital and NAV in addition to interest income. Approximately 100% of the Fund’s NAV consists of either Sterling assets or is hedged into Sterling.

Sustainability

Our comprehensive and award-winning sustainability programme extends throughout our investment process.

Investments

£ 61.1 m

Largest
investment

£ 27.2 m

Average
investment

9.93 %

Portfolio
yield-to-maturity

3.1 years

Average maturity

3.3 years

Average life

2.00

Portfolio mod. duration

40 %

Average equity cushion

11.4 %

Construction risk

Sectors

25.3%

Digitalisation

Data centres 9.6%
Broadband and Fibre 8.5%
Telecom towers 7.2%

20.9%

Power

Other Electricity Generation 7.0%
Base load 5.8%
Standby Generators 4.0%
Interconnector 3.0%
Nuclear Power 0.6%
Energy transition 0.5%

13.0%

Renewables

Solar and wind 6.9%
Waste to Energy 6.1%

11.1%

Transport – vehicles

Specialist shipping 5.1%
Health & Safety 3.7%
Rolling stock 2.3%

8.2%

Accommodation

Healthcare 6.8%
Student housing 1.4%

8.2%

Utility

Midstream 4.3%
Utility services 3.9%

7.2%

Other

Renewables Equipment & Services 3.8%
Hospitals 2.5%
Hospitality 0.7%
Social Infra 0.2%

6.1%

Transport – systems

Ferries 3.0%
Port 2.2%
Rail 0.8%
Road 0.1%

Debt type

Private 94.2% Public 5.8%

Interest type

Floating 44.6% Fixed 55.4%

Ranking

Senior 60.1% Mezz 9.1% HoldCo 30.8%

Region

UK 23.4% N. America 44.3% Europe 32.3%

Currency net of hedges

UK 100%

Project Stage

Construction 11.4% Operational 88.6%