In this webinar, Matthew Norris, manager of the TM Gravis Digital Infrastructure Income Fund, senior research analyst James Peel, and Albane Poulin, Head of Private Credit and fixed income fund manager, joined Cameron Gardner, Head of Distribution, to discuss the evolution of the Fund following its fifth anniversary. They covered the investment thesis, the equity portfolio and the recent addition of a short-duration bond sleeve.

Below are the key takeaways from the webinar and you can watch the replay here:

• The Fund invests in developed market listed securities that own the physical infrastructure supporting the Fourth Industrial Revolution: data centres, communications towers and e-commerce logistics warehouses.
• It provides exposure solely to the "concrete and cables", with no exposure to technology, hardware or software. This allows it to complement technology holdings, or act as a lower-risk, income-focused proxy for them.
• Through its holdings, the Fund is exposed to hundreds of infrastructure assets, thousands of tenants and millions of underlying customers.
• The Fund launched in 2021 and celebrated its fifth anniversary in May 2026. A review at that milestone concluded that the investment thesis is more relevant today than at launch.
• The review also identified an opportunity to increase yield and reduce volatility without changing the investment philosophy. This is achieved through the addition of short-duration bonds.
• Albane Poulin joined the digital infrastructure team earlier this year as fixed income fund manager. She joined Gravis in 2023 as Head of Private Credit to lead its direct debt investment activities and has 20 years of credit investing experience, previously as Head of European Private Placements at Aberdeen.
• The Fund currently has 31 holdings (25 equity and 6 debt), with a 15.5% allocation to fixed income.

• Matthew Norris set out three key messages: the Fund offers a unique way to access the concrete and cables of the AI revolution; it is diversified by geography, asset class (equity and, since 2026, debt) and infrastructure type; and it offers a total return proposition built on yield, growth and upside potential.
• Yield: the forward equity yield is 4% and the yield on the bond holdings is 5.7%, giving a combined forward yield for the Fund of 4.3%.
• Growth: growth comes from the equity portion. Analysts' consensus forecasts point to dividend growth of 6.9% for the equities, and around 5.5% for Fund distributions overall, well ahead of inflation.
• Upside potential: the equity holdings also offer upside to analysts' consensus price targets, which, as seen over the summer, can be crystallised through M&A.
• The team described the opportunity as hard, physical assets with low obsolescence risk and utility-like qualities: next-generation essential infrastructure, high barriers to entry and long-term, inflation-protected cash flows.

• Contracted cash flows: what unites communications towers, data centres and e-commerce logistics is contractual leases with highly predictable cash flows. This contrasts with the transactional revenue models of technology hardware, software and payments businesses, which are much harder to forecast.
• Data centres: the Fund invests in the buildings that house servers, not in chips or servers themselves. AI has driven a data explosion, with data volumes forecast to more than triple between 2024 and 2029, increasing demand for data centres.
• Communications towers: 5G subscriber growth is expected to well exceed population growth, driven by mobile data, 5G adoption and the Internet of Things. Leases for space on towers typically include fixed annual uplifts in the US and index-linked escalators in Europe.
• Logistics warehouses: e-commerce now accounts for approaching a quarter of US retail sales and is forecast to continue to grow. Online retailers are estimated to require three times as much logistics space as in-store sales, and e-commerce growth is reported to account for around a quarter of new US space demand. AI agent shopping could push penetration higher still.

• The equity and bond processes share common principles: a long-term, cash-flow-oriented approach, an eye for value, a bias towards high quality and a high-conviction, buy-and-hold philosophy.
• The equity universe starts with more than 125 potentially relevant companies. After screening out those that are too small, too illiquid or not fully aligned with the digital infrastructure mandate, around 70 remain.
• The portfolio is then built from the bottom up, seeking high-quality companies offering an attractive dividend yield, dividend growth and share price upside. It currently holds 25 equities, diversified across sectors and geographies, with a sizeable watch list maintained at all times.
• James Peel highlighted CTP, a Dutch-listed company added early this year. It is Europe's largest listed developer, owner and manager of industrial warehouses and e-commerce fulfilment centres, with a presence in nine markets and an extensive land bank. Its growth targets are underpinned by near-shoring and rising e-commerce penetration.

• Recurring rental income is a key attraction of listed real estate. Most of the portfolio benefits from leases with contractual fixed uplifts or inflation-linked escalators.
• At Tritax Big Box, which owns UK warehouses, around two-thirds of leases have an embedded escalator and the average lease length is almost 10 years, giving high visibility of rental growth.
• Reversionary potential, which arises when market rents grow faster than contracted rents, provides further upside. Tritax's reversionary potential was almost 30% at the end of last year. Combined with contractual uplifts, this helped it grow like-for-like rents by around 4% last year, and the company is on track for a stronger 2026.
• Strong balance sheets help convert revenue growth into earnings growth. Across the portfolio, the weighted average cost of debt is just over 3%, the weighted average debt maturity is almost five years and the vast majority of debt is fixed rate.
• Portfolio companies have consistently grown their dividends over many years. WDP, a Belgian-listed REIT due to merge with French-listed peer Argan (also held), offers a 7% dividend yield that is well covered by earnings, forecast dividend growth of around 5% and more than 40% upside to consensus price targets.

• The fixed income sleeve was added for two reasons: income and lower volatility. The bond market is deep and liquid, and offers flexibility to express views across maturities, seniority and parts of the capital structure.
• Bonds provide predictable, stable income because issuers have a legal obligation to pay the coupon, and bondholders rank senior to equity which provides downside protection.
• The Fund focuses on short-dated, fixed-rate coupon bonds, intended to be held to maturity, which are less sensitive to interest rate changes, and on investment grade issuers, which offer strong credit quality and low correlation with equities. As bondholders, the team focuses on cash flow, liquidity and credit rating, making the holdings less sensitive to news flow and earnings sentiment.
• The team began adding public bonds in May 2026, when higher yields created an attractive opportunity to lock in additional yield over dividend yields, including in real terms against CPIH inflation. This trend has continued, with the team seeing now as an attractive time to deploy the Fund’s cash balance to add further to the bond allocation.

• The Fund currently holds six bonds, all issued by companies whose equity the team is also happy to hold. The yield pick-up from moving from equity to bonds ranges from 1.2% for American Tower to 4.7% for Goodman. A further bond was added during the month of October.
• All bonds are hedged back to sterling, so the sleeve adds no currency risk to the Fund. All bond yields quoted are on a hedged basis. The bonds within the Fund are issued in minimum denominations of €100,000, which means to scale is required to ensure sufficient diversification and is possible making a Fund a good way to access this part of the market.
• Goodman is currently the most attractive switch from equity to bonds. An Australian- listed logistics company, the market prices it as a growth story, with half of its large data centre pipeline still in development and not yet generating cash flow. Its euro bonds, hedged to sterling, yield 5.8%, almost 5 percentage points above the equity yield. Ninety-day volatility is 2.4% for the bond against 26.3% for the equity.
• Prologis, the world's largest logistics company, is the strongest credit in the portfolio, with a single-A rating and a management team well known for their prudent and consistent capital strategy. Its offer for SEGRO (75% stock, 25% cash) and recent equity issuance signal management's commitment to that credit profile even while pursuing a large scale acquisition. Over the period shown, the equity returned 27.6% against 16.3% for the bonds, but with around five times the 90-day volatility (15.6%).
• American Tower has a weighted average remaining lease term of 5.1 years, with tenants including AT&T and T-Mobile. The Fund's bonds mature before those leases roll off, capturing extra yield while reducing exposure to equity volatility linked to consolidation in the tower sector.
• The Fund remains predominantly an equity fund, with around 80% invested in equities to capture capital growth, while the bond sleeve adds stability and more resilient income.

• The Fund is managed with high conviction, with maximum exposure to an issuer of c.7.5%, combining both equity and credit exposure.
• The portfolio is diversified across REITs, other infrastructure equities and bonds, and across logistics, towers and data centres.
• The Fund's bias towards quality has resulted in significant M&A activity, with bidders including private equity, infrastructure investors and sovereign wealth funds.
• In 2026 this extended to public-to-public mergers. In the space of four weeks over the summer, three portfolio holdings received bids: Prologis for SEGRO in the UK, Brookfield and CPPIB for LXP in the US, and WDP for Argan in France. Gravis was actively engaged attempting to achieve the best value possible for shareholders.

• When the Fund was a pure listed equity investor, performance showed more volatility.
• Since credit was introduced from May 2026, the team has seen an early dampening of volatility. Adding bonds has improved resilience and supported returns during a period of geopolitical uncertainty.
• From around the end of July, global core real estate fell while global corporate bonds were broadly flat. By actively blending the two, the Fund broadly held its ground, delivering what the team considers a more attractive risk-return profile.

Important information

This article is issued by Gravis Advisory Limited (“GAL” or the “Firm”), which is authorised and regulated by the Financial Conduct Authority. GAL’s registered office address is 24 Savile Row, London, United Kingdom, W1S 2ES. The company is registered in England and Wales under registration number 09910124.

The TM Gravis Digital Infrastructure Income Fund (the “Fund”) is a sub-fund of TM Gravis Funds ICVC, which is a UK UCITS scheme and an umbrella company for the purposes of the OEIC Regulations. The Authorised Fund Manager of TM Gravis Funds ICVC is Thesis Unit Trust Management Limited (TUTMAN), Exchange Building, St John’s Street, Chichester, West Sussex, PO19 1UP. TUTMAN is authorised and regulated by the Financial Conduct Authority. GAL is the investment manager of the Fund.

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This article has been prepared by GAL using all reasonable skill, care and diligence. It contains information and analysis that is believed to be accurate at the time of publication but is subject to change without notice. It is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. Any recipients outside the UK should inform themselves of and observe any applicable legal or regulatory requirements in their jurisdiction.