The L&G Private Markets Access Fund – which will be available for DC schemes to invest in directly and via a newly launched range of target date funds, the L&G Lifetime Advantage Funds – will offer a single point of access to a diversified portfolio of private market assets, including private equity, real estate, private credit and infrastructure.

The fund is structured as a fund of funds with an investment in a new private markets long-term asset fund (LTAF) – the Legal & General Private Markets LTAF – sitting alongside exposure to liquid securities, as well as L&G and third-party strategies. It said underlying strategies such as the L&G NTR Clean Power (Europe) Fund and the L&G Build to Rent Fund will be available for inclusion in the fund.

L&G said this structure would enable the fund to deliver liquidity for daily dealing in normal dealing conditions.

It said all asset allocation decisions would be made by L&G’s multi-asset team, subject to their fiduciary duty that aims to invest in the best interests of clients.

L&G said the access fund had already received “considerable interest” from its clients – including the London Stock Exchange Group, EDF Energy and L&G’s own DC pension scheme, indicative of what it said was the “untapped demand and appetite for private market exposure by DC funds”.

It said its target date Lifetime Advantage Funds would seek to improve members’ retirement outcomes through a 100% allocation to growth assets, including a “meaningful allocation” to private markets via the L&G Private Markets Fund, in the earlier years of their savings journey.

The fund range is designed to evolve as members’ needs change in the run-up to retirement, with members staying in one fund throughout their retirement journey during which the fund’s asset allocation will evolve.

L&G has been working to bring its private markets offering to market since 2022, with the intention of delivering greater DC member access to the potential benefits that private markets can provide.

It said the fund’s development contributed to its decision to become a founder signatory of the Mansion House Compact, an initiative launched in July 2023 to enable greater DC access to unlisted UK companies. L&G added that its strategy will include allocations to unlisted equities as part of a diversified private markets multi-asset portfolio, with the ability to allocate up to 40% into UK assets.

The announcement builds on L&G’s strategic update in June where it announced it would bring together its public and private markets capabilities in a single asset management division and target growth in its workplace DC pensions business.

L&G group chief executive António Simões said: “Today’s launch is an important step forward in putting UK pension capital to work to drive economic growth while supporting people to build the savings they need for retirement.

“Building on our refreshed strategy set out in June, this Fund will offer defined contribution scheme savers access to high growth investment opportunities, provide innovative funding for communities, society and the real economy, and power L&G’s Private Markets growth ambitions.”

L&G head of DC Rita Butler-Jones added: “Our members are at the core of what we do, and we believe providing millions of savers with exposure to the potential returns available through global private markets will support the delivery of better long-term retirement outcomes. When developing the fund we have spent a lot of time talking to clients about what is important to them, ensuring that the assets align to our members’ long-term investment horizons, while delivering value for money.

“L&G is the largest pension provider in the UK with over 5.2 million DC members and we believe the launch of this fund will be a game changer for DC pension savers. The fund is a one-stop-shop for private market exposure and we hope it will inspire DC members into greater engagement with their pension, by investing in tangible assets which can benefit the real economy.”