A press release carried in Business Wire reports Centaurus Renewable Energy, developer “of the Arroyo Solar & Storage Project in McKinley County, New Mexico, announced today that it has closed a $70 million construction bridge loan facility provided by Voya Investment Management, the asset management business of Voya Financial.” The credit facility “will be used to make payments for project equipment and for other development and construction expenses.” Voya Investment Management’s Direct Infrastructure team, led by Tom Emmons and Ed Levin, organized the transaction.
In an appearance on Bloomberg TV’s Bloomberg Markets: The Close, Voya Investment Management Fixed Income CIO Matt Toms discussed the debate over when a tightening of Federal Reserve policy is likely to begin. Toms said the Fed is “trying to keep the optionality to taper before December ... and they’re going to go into Jackson Hole and debate, is a September announcement likely to get going?” Toms said the “big debate is do you start in October after a September announcement, or do you wait for the new year?” Regarding the recent bond market turmoil, Toms said there was “a whole rate cycle in the month of June, to where Fed rate hikes or the talk of taper caused a selloff, and then the immediate feedback is, oh dear, what if they do begin to become less dovish?” As a result, Toms said fixed-income markets “begin to already price in the what-if scenario once they start to move.” Toms said that means the “very long end of the bond market” is unlikely to move out of the 1.5-2% range on the 10-year Treasury bond, “and that’s ultimately a really good predictor of the terminal Fed funds rate, one-fifty to two percent.”
MarketWatch reported that as more Americans emerge from lockdowns, and those in the West seek to escape extreme heat, “the appeal of going anywhere, even ‘nowhere special,’ has deepened.” However, skepticism remains about “gathering in a movie theater with strangers,” and commercial property bond investors “weren’t always thrilled about the big, boxy setup of these buildings even before the pandemic hit.” Voya Investment Management Head of Securitized Investments Dave Goodson said in an interview, “We didn’t like movie theaters, generally to speak of, even pre-COVID,” adding “that upkeep can be expensive, even before thinking about what retrofits might be needed to attract another kind of tenant if a theater chain goes out of business.” Goodson said, “Uncertainty around the space, that’s been accelerated with COVID. It forces us to be more cautious.”
Ignites reports, “The old days of sales teams determining who handles each advisor based on where the client lives and the size of its portfolio are over, distribution executives say.” Voya Investment Management Head of Distribution Enablement and Intelligence Jane Conway said the rapid shift to hybrid sales and digital engagement has accelerated changes in how sales teams cover advisors. According to Conway, that “means moving away from traditional coverage models based on ‘zoning’ that mapped out how wholesalers could most efficiently visit clients in a territory.” Conway said, “In our new ways of working, we wonder if zoning is even important. What Covid has taught us is to be innovative in the way that we engage with clients.”
Voya Investment Management announces first close of new infrastructure debt fund focused on renewable energy project financing
Voya Investment Management (Voya IM) announced today that its private credit platform completed the first close of a new infrastructure debt fund focused on project financing in the renewable energy space. With over $300 million in commitments, the first close comes on the heels of Voya IM’s hiring of Tom Emmons and Edward Levin, co-heads of Voya IM’s direct infrastructure team responsible for the origination, underwriting, structuring and management of mezzanine and stretch senior opportunities in renewable energy infrastructure projects.
In an interview on Bloomberg TV’s The Close, Voya Investment Management CEO Christine Hurtsellers said, “I think we’re starting to see what I would call exuberance in some of the pockets of the U.S. housing market, given how strong home prices are.” Hurtsellers said Voya sees the market as having “all kinds of really great fundamentals; however, really fully priced. So picking your spots and thinking about how the world could change as the Fed becomes more engaged around inflation ultimately, that could certainly bring some issues to bear.” Asked about the “ripple effects” on risk assets of the Fed unwinding its monetary stimulus policy, Hurtsellers said that as inflation becomes not just a “transitory event and becomes a little bit more cyclical, like wage increases stick, it’s going to create some volatility. It could impact the small-cap indexes ... But again, I think you’ve just got to be very careful, you know, in the months to come to not get overly sanguine around easy money, excess liquidity, and that it’s going to go away and that it’s not going to have effects.” Asked “where do you put your money to work” to manage these risks, Hurtsellers said, “Some of our favorite trades as far as both rebound and somewhat of an inflation hedge is commercial real estate ... There are some pretty attractive opportunities, including retail ... (which) can also be a good inflation hedge to the degree that we start to see a tick-up in interest rates.”
In a MarketWatch podcast for Barron’s Live, Voya Investment Management Head of Multi-Asset Design Amit Sinha said Voya “offers health, wealth, and investment management solutions” using “investment strategies that meet specific outcomes that an investor desires.” Sinha said Voya looks at “all available investment opportunities ... in order to design portfolios that meet what an investor needs ... For individuals, we manage target-date funds that help with saving for retirement, and we also manage investment strategies that support an individual’s spending once they are in retirement.” Sinha added, “When it comes to something so critical as retirement, it’s very personal and emotional. So my thinking has evolved towards having a greater appreciation that people have different concerns than just beating the market.”
Financial Advisor Magazine reports financial advisors see “lots of potential for continued growth” in the U.S. economy, “assisted by the economic stimulus package.” However, “the tax increases that are being proposed could have a negative impact on mid- and small-sized companies and, therefore, on investors, said Paul Zemsky, chief investment officer of multi-asset strategies and solutions at Voya Financial.” Zemsky “said he sees some potential for bad news, along with the increasing economic growth and overall good performance of the stock market. Long-term joblessness and weak labor force participation will remain major concerns and ‘are the main reason the Fed is holding its dovish posture,’ he said.” Zemsky noted the impact of any proposed tax increases “depends on what gets through Congress,” but said hikes in capital gains and corporate income taxes “will make business activities less profitable for investors and for corporations.” However, Zemsky explained, “I still expect to see record investment and business profits for the rest of the year. If equities become less profitable, we may see a shift to bonds” despite low rates. Zemsky added, “Right now, advisors should tell their clients not to overreact. The proposals that are being discussed are trial balloons and might not come to pass.”
Kiplinger reported markets “brushed off a dismal April jobs report Friday” as the Dow Jones and S&P 500 closed the week at new highs despite the economy adding only 266,000 jobs last month, “well below the nearly 1 million expected by economists, while the unemployment rate ticked higher to 6.1% from 6.0%.” Voya Investment Management Head of Fixed Income Research Brian Timberlake said, “The payroll data does not suggest that the reopening is stalling. On a non-seasonally adjusted basis, 1.1 million jobs were added.” Timberlake said the upward tick in unemployment coincided with a small rise in the overall labor force participation rate, adding, “As a result, the employment-to-population ratio – which we view as more representative of the current labor market dynamics – increased for the month from 57.8% to 57.9%.” Timberlake ventured that the disappointing jobs report would likely “give Fed Chair Powell some relief on the urgency to talk about tapering.” In other words, said Kiplinger, “no changes to the central bank’s bond-buying program and no interest-rate hikes quite yet.”
In an analysis, CNN reports that investors “should ignore the dumb, antiquated saying about selling in May and going away.” Investors “need to pay attention to the headlines — not what month it is” — because “it’s not as if Corporate America and the economy go on summer break.” Voya Investment Management Multi-Asset Strategies and Solutions CIO Paul Zemsky said, “There is no proof of any kind that selling in May and going away will add value ... First of all, market timing is very hard. And we like stocks and are not going to change that opinion just because the calendar says May.” Zemsky added, “The fundamentals remain strong and that’s what we look at. The economy is on great footing.”