EUROPE – Denmark's AP Pension is selling five properties to adjust its overall real estate allocation in the wake of last year's merger with FSP Pension, clinching deals giving the company gains of 10% in one year.
The five buildings in Copenhagen and Aalborg have been sold for DKK820m (€110m), the commercial pension provider said.
Steen Jørgensen, director of AP Pension and former head of FSP Pension, said: "The five buildings, which were part of the FSP Pension property portfolio, were booked during the merger with AP Pension in 2012 with a value of around DKK750m."
AP Pension said property prices had risen as a result of investors seeking alternatives to bonds.
It said more and more investors were now leaving the bond market, and big investors – including pension funds – did not expect 2013 to be a good year for bonds.
People were looking for investments that could produce a stable return, match the return of bonds and that were at the low end of the risk scale, it said.
AP Pension said it was adjusting investment assets to conform to its joint future strategy, following last year's merger.
The property allocation has been set at 10-15%, which means FSP's property portfolio has to be brought to the same proportion of total assets as AP Pension, the company said.
The properties sold are Blegdamsgården and Nordlyset in the Østerbro district of Copenhagen, Applebys Plads in Christianshavn in Copenhagen, Hvidts Gaard on the harbour-front in Aalborg and Dronningens Vænge in Kongens Lyngby.
All together, the properties had 33,000 square meters of space.
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