ImpactAlpha, May 12 — Private equity funds are bracing for a challenging fundraising year. Not Brookfield Asset Management. Already this year, the Canadian firm has raked in $19 billion across its strategies. Its second energy transition fund is expected to approach $25 billion.
The firm’s Bahir Manios cited the “strong demand from institutional capital for this strategy” on the firm’s quarterly earnings’ call this week.
Brookfield closed its inaugural transition fund at $15 billion last June, calling it the largest energy transition fund on record. The fund is already 85% deployed. “The amount of capital that is required in this sector is very large,” said Brookfield’s Bruce Flatt.
Brookfield is following the money as it looks to double its fee-based assets under management to $1 trillion within five years and offset its troubled commercial real estate portfolio. Helping energy and industrial companies decarbonize, along with a push into credit, is key to that effort.
“The scale of our capital focused on transition really makes us unique,” said Flatt. “And that does allow us to target not only the largest, but the most attractive opportunities in the transition space.”
In March, Brookfield led a consortium of investors in a $10 billion takeover of Origin Energy to “deploy our renewable development capabilities to decarbonize and transition a very large energy market player in Australia,” said Flatt. The transition fund portfolio also includes a $1 billion investment in Mumbai-based Avaada Group to finance green hydrogen and ammonia projects.
Asia and the Middle East have taken on greater importance in Brookfield’s overall fundraising and investment strategy, as commitments from US-based investors have slowed.