The London Fund to co-invest alongside Macquarie Asset Management to support and grow London’s digital infrastructure

Local Pensions Partnership Investments Limited (“LPPI”) Announces that The London Fund (“the Fund”) has agreed to co-invest alongside Macquarie Asset Management in its acquisition of a significant minority stake in London-based VIRTUS, one of the leading and fastest growing hyperscale data centre platform in London[1], Europe’s largest data centre market.

VIRTUS is an award-winning, pure-play data centre owner-operator, providing state-of-the-art critical digital infrastructure which provides vital connectivity and access to online services for residents and businesses in London and beyond. With some of the world’s largest hyperscalers amongst its clients, the business provides intelligent solutions to improve the storage, retrieval, management and security of data across global networks.

Established in 2008, VIRTUS currently comprises 11 sites in and around London, including in Enfield, Hayes, Slough and Stockley Park, with a combined capacity of more than 100 megawatts. As part of ST Telemedia Global Data Centres, VIRTUS has a proven track record of delivering new capacity in increasingly power-constrained areas such as West London. The business aims to build more sites in the Greater London area in line with increasing data needs, while beginning to expand its operations into Europe.

The VIRTUS investment also delivers on its Positive Social Outcomes promise by supporting London’s digital ecosystem through a data centre platform which matches its electricity consumption to 100% renewable energy procurement alongside its wider commitment to net zero by 2030 and efficient water and energy usage.

Richard Tomlinson, Chief Investment Officer, Local Pensions Partnership Investments, said: “Digital infrastructure has been driven by long-term tailwinds including growing data consumption and the development of cloud computing and VIRTUS’s success is testament to this. With this investment, we’re pleased to be supporting a key global player in a rapidly growing sector, enhancing London’s digital ecosystem, whilst also proving that commercial success and a commitment to net zero can be compatible business goals.”

Vanessa Shia, Head of Private Markets, London CIV, said: “We are delighted to have partnered up with Macquarie in our co-investment in VIRTUS through The London Fund. This builds on our continual focus to making critical investments in London and greatly complements our existing portfolio. This is one of our first direct investments in the digital infrastructure space, and, given the essential role it plays in supporting global connectivity by offering an alternative to travel and commuting, represents a pivotal investment on behalf of our clients in their journey to net zero.”

Phil Peters, Head of Macquarie Asset Management’s Client Solutions Group, said: “We are very pleased to be extending our existing partnerships with LPPI and London CIV, the collaborators of The London Fund, with this co-investment in VIRTUS Data Centres alongside our managed funds. The London Fund’s objective of investing in assets that have positive benefits for Londoners very much aligns with our responsibility and opportunity to drive positive change for all our stakeholders through our investments.”

The London Fund will co-invest in VIRTUS alongside Macquarie Asset Management, the world’s largest infrastructure asset manager. In August 2022, Macquarie Asset Management announced it would partner with ST Telemedia Global Data Centres to support the long-term development of VIRTUS in an agreement to acquire a significant minority stake in the business via Macquarie European Infrastructure Fund 7. The transaction completed in Q4 2022 following the satisfaction of customary closing conditions.

VIRTUS represents The London Fund’s first infrastructure investment, a core investment pillar, and its fourth major investment following its recent co-investment in sustainable office tower, EDGE London Bridge, and a £30m commitment in YOO Capital Fund II L.P.

The London Fund’s portfolio focuses on investments in the City of London Corporation, the 32 London boroughs and their immediate surrounds, in assets such as residential property – specifically build-to-rent – and affordable housing, community regeneration projects and infrastructure, including digital infrastructure and clean energy.