NETHERLANDS - Pensioenfonds van de Metalektro (PME) is diversifying its real estate exposure by investing opportunistically on a global basis.
The Dutch pension fund for mechanical and electrical engineering industries allocates 8% of its €22bn of assets under management to real estate, the majority of which comprises directly held Dutch properties.
However, PME is aiming to bring diversification to the portfolio by expanding its indirect international investments.
Gerda Smits a spokesperson for PME, said: "PME is currently working on a further expansion of the international portfolio. In the recent period, PME commenced with an international portfolio of more opportunistic nature. This is to further diversify the portfolio."
PME's real estate portfolio delivered total returns of 9.1% in 2007 and Smits says diversification helps the pension fund in performance with lower risk.
"This is achieved by a broad diversification of its portfolio over sectors and countries," she said. "This lowers the overall risk and improves the overall return of the portfolio."