Nordic pension funds are selling down their domestic real estate holdings and re-investing internationally, PropertyEU's latest investment briefing on the region has heard. The trend is creating an opening for foreign investors to get into the Nordics, an attractive but difficult market to access.
Nordic pension funds are selling down their domestic real estate holdings and re-investing internationally, PropertyEU's latest investment briefing on the region has heard. The trend is creating an opening for foreign investors to get into the Nordics, an attractive but difficult market to access.
'We are seeing a trend at the moment where the local pension funds - who are heavily invested in their own geographical locations - are actually selling off some of their stock in order to reinvest internationally and mostly in Europe, Rikke Lykke, head of the Nordics at Patrizia, said. 'They are very focused on Germany at the moment, and looking at the UK, the Netherlands and elsewhere.'
The move to diversify opens the door to international investors who want to access the 'safe harbours' in the Nordics by acquiring good quality real estate assets being sold off by the pension funds.
Andrew Smith, managing director at Swedish-headquartered Catella, said big funds are ‘going up to Stockholm, to Copenhagen and to Helsinki’ to talk to local pension funds about attracting capital into pan-European funds.
‘We have been approached at Catella to set up a product that would allow some of the pension funds to deploy their Swedish capital into London, Paris and Germany. Already we have successfully deployed €500 mln with a vehicle called Cityhold. We have also been able to take Swedish pension fund capital into value-add in the UK.’
Click here to watch the panel discussion on the trend