German ‘free trades’ pension funds invest in Luxcara’s third renewables fund

Luxcara aims to take in as much as €250m in capital for new offering

German renewables investor Luxcara has successfully launched its third renewable energy fund, taking in €50m in assets from a slew of German institutions following a recent first closing.

According to industry sources, the investors include so-called Versorgungswerke, which are pension schemes for free trades like medicine and the law, as well as insurers, foundations and corporate investors.

Up to 10 more closings are planned, and Luxcara said that the group of investors could provide as much as €250m by March 31, 2016. Including leverage, Luxcara says the total volume of the fund, which invests in wind and solar parks around Europe, could reach €1bn. The target return is a net 5.5% per annum. “The return is a big reason why so many German institutions invested in the fund,” said the sources, who asked not to be identified.

Luxcara said its third fund had already begun investing the assets, buying two wind parks in Germany just last month. The fund also plans to acquire additional wind and solar assets in France, the UK and the Nordic countries. “Due to our long-standing relationships and extensive track record in the industry, we have secured continuous access to such high-quality assets,” said Kathrin Oechtering, one of Luxcara’s two managing partners. Luxcara’s first two funds were focused strictly on photovoltaic projects and, according to the firm, achieved investment volumes of €80m and €700m, respectively.The second fund, known as Flaveo, was launched in 2011 after Luxcara won over two Versorgungswerke, namely the €60bn Bayerische Versorgungskammer (BVK) and the chartered accountants’ scheme WPV. The BVK and the WPV both contributed €140m to Flaveo, and Luxcara said they were among the investors in its combined wind and solar fund.

Luxcara was founded in 2009 by Oechtering and Alexandra von Bernstorff, the other managing partner, after they worked together at Danish renewables firm Renewagy A/S. At Renewagy, von Bernstoff served as Chief Executive, while Oechtering was an Investment Director.

The Hamburg-based firm has since grown to 15 employees, including Bernstorff and Oechtering as well as specialists for the financing and management of projects, investor relations and controlling. Between its three funds, it has €2bn in assets under management. In February 2012, Luxcara became one of the 28 asset managers from Germany that have signed the Principles for Responsible Investment (PRI).

Regarding the distribution, Luxcara offers its funds directly to institutional investors and has a sales cooperation with M.M. Warburg, a private bank also based in Hamburg. Warburg is also handling the administration of Luxcara’s third fund, which is domiciled in Luxembourg. Link