On Wednesday, Nuveen, the $1.2 trillion investment management arm of the Teachers Insurance and Annuity Association of America (TIAA), announced that has completed the initial public offering (IPO) of its Nuveen Core Plus Impact Fund (NPCT), a closed-end fund that will begin trading on the New York Stock Exchange immediately.
The fund, which raised $575 million in its common share offering, will seek deliver total return through high current income and capital appreciation, by investing in a diversified portfolio of fixed-income investments across four social and environmental themes: Affordable Housing, Community and Economic Development, Renewable Energy and Climate Change, and Natural Resources. The fund may also invest in issuers that demonstrate environmental, social and governance (ESG) leadership.
The fund strategy will use Nuveen‘s proprietary Public Markets Impact Framework to identify opportunities to generate measurable positive social and environmental impact, as well as its ESG criteria, while also delivering competitive financial return. Some of the fund’s AUM will be dedicated to impact investing opportunities, including investments that provide exposure to issuers and/or individual projects with direct and measurable social and/or environmental benefits.
The remaining portion of the fund will be dedicated to ESG investments, providing exposure to issuers with leading ESG practices relative to industry peers. All investments in the fund will be evaluated using Nuveen‘s relative value framework to deliver competitive financial returns.
“At Nuveen, we have a long history of not only pioneering responsible investing but also delivering income solutions,” said Dave Lamb, Head of Closed-End Funds at Nuveen. “We are proud to bring these together, while building on our heritage of innovation in closed-end fund strategies, to launch the Nuveen Core Plus Impact Fund, the industry’s first responsible investing closed-end fund.”
With over $15 billion in assets managed just in these strategies, Nuveen is one of the largest investors in ESG and impact fixed income. The firm also has approximately $39 billion in responsible investing strategies across public and private markets and over five decades of experience in the responsible investing space.
“Recent demand for opportunities aligned with investors’ values has been met with a surge of green, social and sustainable bonds, and increased awareness of the environmental and social benefits that can accompany competitive financial returns. This has propelled the growth of the impact bond market.” said Stephen M. Liberatore, Lead Portfolio Manager for Fixed Income ESG and Impact Investments at Nuveen, speaking on the fund’s public market debut.
Shares of closed-end investment companies, like the fund, generally trade on a national stock exchange. As is the case with stocks, the fund’s share price will fluctuate with market conditions and, at the time of sale, may be worth more or less than the original investment. Shares of closed-end funds often trade at a discount to their net asset value (NAV).
