Ilmarinen is to finance the construction of 500 housing units in greater Helsinki, in a €100m deal with local developer SRV.

The Finnish pensions mutual said the agreement would see construction of 430 private rental units, largely in Finland’s capital, the country’s second city Espoo, the city of Vantaa and the district of Jätkäsaari.

Around 200 of the units will also be built in Kerava, a town within commuter distance of Helsinki.

As part of the deal, Ilmarinen has also acquired 41 units already completed by SRV.

Tomi Aimonen, the mutual’s head of real estate investments, said the investment was possible due to a law temporarily allowing the sector to leverage its rental housing investments.

“As part of our housing investment programme, our goal is to implement around 1,000 non-subsidised rental housing units, mainly in the Helsinki Metropolitan Area,” Aimonen added.

He said the 1,000 unit target would be contingent on the temporary leverage exemption being extended to 2019, from its current end date of 2017.

SRV said construction on the new units would get underway this summer, with completion by late 2017.

Antero Nuutinen, senior vice-president of Finnish housing at SRV, praised the venture as the latest in a long line of projects where it had collaborated with Ilmarinen.

He added that the population of greater Helsinki was set to grow by 10-15% by 2040.

“We want to be involved in developing Finland’s growth centres with long-term partners like Ilmarinen, and to contribute to providing solutions for the Helsinki Metropolitan Area’s challenging housing situation.”

Ilmarinen has recently completed a series of deals in Germany, acquiring its first hotel asset in the country only last December.

It has since also bought a stake in a Berlin office, and one in Frankfurt.