This article is from the Australian Property Journal archive
DAVID Di Pilla’s active funds management platform HMC Capital has made its expansion into the energy transition sector, acquiring four operational wind, solar and storage assets and six development sites in Victoria for $950 million.
HMC also said it is “well advanced with multiple institutional cornerstone investors” with first close of the inaugural energy transition platform on track for first half of calendar 2025, with an initial raise up to $2 billion-plus.
The deal to acquire Neoen’s portfolio is a another step for HMC towards its ambition of growing to $20 billion in assets under management during 2025, and to $50 billion within five years. It now sits at around $19 billion.
The acquisition is the result of the Australian Competition & Consumer Commission ordering French company Neoen to divest its Victorian assets to allow its takeover by Brookfield to go ahead.
HMC said the portfolio is a “unique, event-driven opportunity to secure a high quality, diversified portfolio of operational and development assets in the state of Victoria which currently has 59.2% of energy from coal generators and has a significant decarbonisation task”.
The portfolio comprises 652 megawatts of installed wind, solar and BESS capacity across four operational assets, with a de-risked core cash flow generation with around 85% contracted off-take position at operating assets, a circa-10 year weighted average remaining contract life, and a diverse book of about 85% investment grade counterparties underpinning cash flow generation available to fund growth opportunities.
Legislated renewable targets are of 65% by 2030 and 95% by 2035.
The portfolio also includes a pipeline of around 1.5 gigawatts in wind development projects and 1.3 gigawatts in storage development projects with development, environmental and planning studies or approval processes and grid connection preparation underway for the projects.
HMC’s managing director and CEO, David Di Pilla, said, “Our move into the energy transition sector reflects the significant level of investment required both in Australia and globally to achieve decarbonisation targets.
“We have received a significant level of interest from domestic superannuation funds to be foundation investors in HMC’s energy transition platform who are attracted to both long-term transition fundamentals and HMC’s capability.”
Di Pilla’s active funds management platform HMC Capital is targeting $50 billion in assets under management within the next five years – setting itself an ambitious goal of 42% growth per year in order to bring that forward to just three years.
HMC in July acquired a seed asset investment in Stor Energy for its energy transition fund. Stor Energy has a portfolio of six utility-scale BESS development assets across four states totalling 1.5 gigawatts of capacity, with a further identified pipeline of 1.2GW across seven projects also now under development.
At its recent annual general meeting, Di Pilla outlined HMC’s ambition for up to 42% growth year-on-year for the next three years.
HMC has also just launched its new ASX-listed data centre asset platform, DigiCo Infrastructure REIT, with its $2.746 billion IPO successfully underwritten. The REIT will own a $4.3 billion in data centre assets across Australia and the United States, with HMC lodging the new REITs prospectus and product disclosure statement with ASIC.
In July, it established its $1.8 billion private credit platform with the acquisition of commercial real estate lender Payton Capital. HMC is aiming to grow its assets under management in private credit in FY25 to over $3 billion.
