REAL ESTATE – Varma Mutual Pension Insurance Co., Finland’s largest private insurance company, has agreed to sell 116 retail properties to a real estate fund.

Sveafastigheter Fund II said it has signed an agreement to acquire the properties, which have 108,000m2 of lettable space for €74m. Sveafastigheter will access the properties on July 3.

The move is Sveafastigheter’s third acquisition in Finland in two months.

The main part of the portfolio area is let to the food wholesaler and retailer Spar.

Finnish asset management company HGR Property Partners will be responsible for the letting and asset management of the portfolio as well as being a minority owner in the portfolio.

This acquisition is the fifth carried out in the Sveafastigheter Fund II real estate fund. Since the fund was launched in April, properties worth over SEK 1.5bn have been acquired.

“Finland is a very interesting market for us, which our recent acquisitions clearly show,” said Sveafastigheter chief executive Simon de Château.

“The acquisition pace has been high and we are currently evaluating a number of further deals in Sweden and Finland.

“The intention going forward is that we shall make acquisitions in the Baltic states and possibly in Poland and we are therefore currently seeking interesting investment opportunities in these markets as well.”

Earlier this year Varma reported an 11.6% return on its investments in 2005 – boosted by a shift into equities out of fixed income.

“In 2005, the share of equities was increased and that of fixed income investments reduced, which resulted in an increase in investment income,” Varma said in its 2005 report.

Equities returned 29.4%, loans 4.5%, bonds 4.5%, other money-market instruments and deposits 2.0% and real estate 6.0%.