The $88 million Bermuda Infrastructure Fund was set up to provide capital for private companies as well as public projects, one of its co-founders has explained.

But the only known cash injection since its launch more than 14 months ago — when it was suggested that upgrades to roads and bridges would be among early contenders for the money — has been $1.5 million to an electric vehicle-rental company.

Don Mackenzie, the chairman and owner of New Venture Holdings, said last week that the fund was created as a way for international businesses to provide finance amid limited borrowing opportunities.

He explained: “BIF has a flexible view as to what constitutes infrastructure and sectors include transportation, energy, healthcare and telecommunications.

“To date, BIF has met a number of local groups and companies seeking investment capital.

“BIF has also had discussions with Government about funding certain public sector projects.”

The fund was devised by Mr Mackenzie, Brian Duperreault, the chief executive of American International Group, and Preston Hutchings, the chief investment officer at Arch Capital Group.

A launch announcement in May 2018 claimed that almost $100 million had been raised.

It added: “In the first instance, the types of projects the fund will consider are ports, docks, roads, bridges, industrial facilities and healthcare facilities, among others.”

Mr Mackenzie said: “The purpose of the fund is to work with the international and local insurance companies to provide capital to support a platform that provides the Bermuda public and private sector with foreign direct investment.”

He explained: “Bermuda as a whole needs to attract FDI to support businesses and projects where local financing is scarce or not available.

“The international businesses sector has a large pool of capital to invest and, prior to BIF, international companies in Bermuda were precluded from investment in local projects.”

Mr Mackenzie said the fund offered equity and debt finance that “might otherwise not be available on the local financing markets”.

He added that the fund’s goals were to assist projects and companies that improve Bermuda’s infrastructure, stimulate the economy and create jobs.

David Burt, the Premier, said in November 2017, when he was also the Minister of Finance, that it was hoped the fund would attract $100 million from Bermudian-based insurance companies.

He said then that examples of the “many potential investment opportunities” that might be considered included “upgrades to Bermuda’s energy infrastructure, sewage treatment, new port facilities at Marginal Wharf, redevelopment of the Hamilton waterfront” and the construction of mixed-use residential and commercial buildings in the city.

The Ministry of Finance said in June that the fund, which started operations in June last year, had raised about “$88 million in capital commitments from limited partners including the Government of Bermuda”.

The response explained that a “small loan” was made to a new electric vehicle-rental business in April last year to help it acquire assets and that a $1.5 million investment in the same firm was expected to be completed in June.

Beverley Connell, from Pembroke, said in a Letter to the Editor last week that she had asked about use of the fund as part of a public access to information request.

The response to her, as well as details given to Dwayne Robinson, the Opposition public works spokesman in the Senate, revealed that a term sheet was signed to invest up to $10 million with a new fixed wireless internet provider and that the BIF was evaluating a $35 million indoor vertical farm with an accompanying solar development.

Mr Mackenzie said that Fortress Investment Group, which has its headquarters in New York, managed the fund and was responsible for “locating and analysing projects”.

He added that the BIF was “primarily a private sector venture” and that the private investors bear all of the risk.

Management fees are payable twice a year in advance, in an amount equal to 0.75 per cent of capital invested, with a minimum annual fee of $1 million.

If the fee is less than $500,000 over the period, the Government must pay the difference and that amount represented an interest in the fund.

The Government’s commitment to make up any shortfalls is capped at $3 million.

Mr Robinson said last week there was “structural decay” in buildings such as schools.

He added: “I believe that we definitely are in need of an actual infrastructure fund.

“This infrastructure fund is currently operating as a venture capital one in a country where capital is very stringent and there are not many options.

“I’m not opposed to providing relief for Bermudian entrepreneurs to receive a large amount of capital.

“However, this infrastructure fund should be used to repair our ageing infrastructure.”

A finance ministry spokeswoman said last week: “The Bermuda Government remains committed and supportive of the fund, and at times provides guidance and necessary assistance.”