Legal & General Capital

Legal & General Capital (LGC) operates as the principal investment arm of the Legal & General Group, a major UK-based financial services company founded in 1836. LGC was established to actively invest the Group's own capital into key sectors of the UK economy, focusing on areas with a significant societal impact and long-term growth potential. The firm's investment strategy targets real assets, deploying capital into sectors such as housing, specialist commercial real estate, clean energy, and venture capital. By concentrating on these alternative assets, LGC aims to generate superior risk-adjusted returns compared to more traditional investments, while also creating tangible assets that benefit communities. The business model involves taking direct stakes in projects and businesses, often acting as a long-term partner and developer. For instance, LGC is involved in building new homes, developing urban regeneration projects, and financing clean energy infrastructure, thereby addressing structural shortages and contributing to economic growth.

The firm's client base is effectively the Legal & General Group itself, as it invests the Group's balance sheet. However, the ultimate impact of these investments serves the Group's stakeholders, including pension-plan members and shareholders, by generating stable, long-term returns. In a strategic evolution announced in June 2024, LGC was integrated into a new, unified global Asset Management division alongside Legal & General Investment Management (LGIM). This move is designed to create a more powerful proposition by combining LGC's expertise in originating and managing private market investments with LGIM's extensive public market capabilities and global distribution network. The combined entity will offer blended public-private asset solutions to institutional clients worldwide, addressing the increasing demand for productive finance—investments that deliver both financial returns and positive societal outcomes. This restructuring positions LGC to scale its alternative asset strategies for a broader international client base, leveraging the synergies between private and public market expertise to create more comprehensive investment products.

Keywords: principal investment, alternative assets, real assets, direct investment, urban regeneration, housing development, clean energy finance, asset management, productive finance, institutional investment