DENMARK - Danish pension funds ATP, PFA Pension and PensionDanmark are jointly investing DKK390m (€52.3m) in two silos in Copenhagen, developing the property into an office building with 14,000 square metres of space.

The three institutions have signed an agreement to buy the property in the North Harbour area of the capital from NCC Project Development, and will take it over on a fully-let basis in 2014.

Michael Nielsen, director at ATP Real Estate, said: "We are positive when investment opportunities come up that meet the high demands we have about quality and ongoing returns."

It was very good to see the first investment opportunities in North Harbour had these qualities, he said, adding that this boded well for future development of the area.

The two Portland cement silos were originally built in 1979 and will form the basis of the construction.

Work on the project is due start in October, with completion scheduled for April 2014.

Søren Ulslev, director of real estate at PensionDanmark, said: "The whole northern port area is incredibly interesting. Together with ATP, we are already in full swing completing the UN City building on Marmormolen, and now we are also involved as a partner in this very exciting office project."

He said PensionDanmark was also expanding its property portfolio strongly over these few years, and hoped to continue this growth in the North Harbour area.

At a height of 59 metres, the new building will be the tallest in the district, with seven storeys.

At the top, there will be a communal canteen for all the building's tenants and an outdoor terrace providing a panoramic view over the Copenhagen harbour and Østerbro district.

The pension funds described the planned building as modern and "spectacular", and said it was being built to high environmental standards.

It will be classified as 'very good' on the BRE Environmental Assessment Method (BREEAM) system.

The building is designed by DesignGroup Architects and built by the seller, NCC Construction Danmark.

It is expected to be ready for occupation in April 2014, and the three pension funds will take it over as a fully let project.

PensionDanmark said it had invested a total of DKK8.6bn in Danish commercial and residential property, or around 7% of assets under management.

It aims to increase this proportion to at least 10% by 2015.