DENMARK - The property arm of Danish pensions giant ATP has teamed up with labour market fund PensionDanmark to buy three department store buildings in the country's biggest real estate deal of 2010.
PensionDanmark said it hoped the partnership would lead to more joint property investments with ATP and that future deals could also involve infrastructure.
The three properties bought currently house Magasin department stores and are located in Lyngby, Aarhus and Odense.
ATP Ejendomme and PensionDanmark acquired the buildings in a joint investment with equal shares of 50%.
Neither party would disclose the price, but a spokesman for PensionDanmark said the deal was the largest seen in Denmark last year.
The properties were sold by Magillum Properties. Magasin, the current tenant, is part of the UK-listed Debenham Group.
Torben Möger Pedersen, managing director of PensionDanmark, said this was the fund's first investment in retail properties.
"They make a really good supplement to our existing portfolio of office and residential properties," he said.
"The three department stores all have prime locations and an attractive tenant, and, consequently, we expect a good return on our members' pension savings."
ATP Ejendomme managing director Michael Nielsen said the investment was a good addition to its existing properties.
"We have observed that retail properties have a different risk profile compared with office properties, and this investment contributes to meet our objective that 20% of our properties be in this segment," he said.
Möger Pedersen held out the possibility of future deals with ATP.
"This is our first joint property investment with ATP," he said.
"We hope the investment co-operation can be further expanded in the coming years with regard to properties, but also infrastructure could be a possibility."
Meanwhile, PensionDanmark also announced it is buying an office block in the Copenhagen area - a purchase that brings its domestic property allocation up to around 7.3% of total assets.
At the end of January, the fund will take over the 24,000 square meter EY-Tower building in Søborg in Copenhagen from Højhuset Mørkhøj A/S.
Current tenant Ernst & Young has a 15-year lease.
Søren Ulslev, director of PensionDanmark's property arm, said: "The property is newly renovated, has a really good position and is a good supplement to our other investments in commercial property.
"We are working in a targeted way to find attractive investment opportunities in the residential, office and retail property sectors, so it is satisfying that we have succeeded in expanding our property portfolio so significantly in the last few months."
This latest deal, combined with other purchases made since the beginning of November, brings PensionDanmark's total investment in Danish commercial and residential property to DKK7.3bn (€980m), the fund said.
This equates to around 7.3% of assets, since PensionDanmark's total assets were DKK98.4bn at the end of June, according to its interim report.
Although prices for the deals have not all been disclosed, back in October, PensionDanmark put its investment in Danish property at just over 6% of assets.