Legal & General has secured around €600M (£520M) for the first close of its new L&G Digital Infrastructure Fund, with a second close expected later this year for a fund that will make a significant investment in data centres.

L&G said that the fund had attracted capital from a mix of investors, including local government pension schemes, specialist infrastructure funds and global asset managers. L&G has also committed capital from its own balance sheet.

The fund is designed to tap into demand for digital infrastructure, a sector facing a £1.8T funding gap by 2030, according to L&G. It aims to deliver a gross internal rate of return of 15% through investment in what the company described as “fast-growing businesses and assets that support digital transformation, strengthen connectivity and deliver long-term economic gains.”

While its primary focus is on the UK and Europe, the fund will also make selective global investments, principally in the U.S. As well as data centres, the fund will invest in fibre, wireless connectivity and cloud services.

L&G was an early mover in digital infrastructure, initially investing in the sector in 2018. It holds a stake in the UK-based data centres operator Kao Data, which has expanded to seven facilities across four sites. L&G is also behind a £750M hyperscale data centre development in Newham, London.

“Infrastructure is a key tenet of our expanding private markets platform and a global, generational investment opportunity,” L&G Asset Management Head of Private Markets Bill Hughes said in a statement. “This first close adds to the strong momentum across our infrastructure offering, as we continue to back the businesses and assets that will drive the energy transition and digital economy, whilst seeking to deliver long-term value for investors.”

Jack Colbourne, formerly at Arcus Infrastructure Partners, has joined as a nonexecutive director on the investment committee, while Achal Arora has been appointed managing director for digital infrastructure investments, joining from Macquarie Asset Management.