REAL ESTATE – Aargauische Pensionskasse (APK), a CHF5.5bn (€3.4bn) pension fund for Swiss civil servants, has invested CHF50m in two separate housing projects in the city of Aarau.

The projects, which include 65 new flats for the elderly and a mixed use building, are to be launched this summer and completed by October 2008.

At the end of 2005, the scheme had CHF672m – or 12% of its assets – invested in real estate. Direct holdings in Aarau and elsewhere in the Swiss canton of Aargau accounted for roughly half of that sum. The other half of the sum is invested in real estate funds and shares.

Earlier this month, APK said its return for 2006 was 7.2% - above the average of 6.6% for Swiss schemes. It said the "excellent" return was due to both to its very diversified portfolio as well as a good performance of its equity and hedge fund investments.

At the end of 2005, APK had 26% invested in equities as well as 6% in hedge fund and 6% in commodities. Fixed income made up 27% of its assets, one of the lowest ratios for Swiss schemes.