Top Deals 2012: Norges heads 2012 ranking

Norway’s sovereign wealth fund took the investment crown last year with German players also beefing up their weight

Norway’s sovereign wealth fund tops PropertyEU’s ranking of top investors by total transaction volume in 2012. The SWF chalked up a transaction volume of more than €2.6 bn over the 12 month period.

This represents a 200% jump year-on-year, propelling the fund - managed by Norges Bank Investment Management (NBIM) - 16 places from last year’s ranking when it recorded a volume of €845 mln. Ironically, Norges’ two transactions in 2011 were carried out in Paris through a joint venture with the real estate arm of French insurer AXA, the top investor in 2011 (total volume €2.6 bn). Based on reported volumes, AXA Real Estate has slipped back in the 2012 ranking to 8th place with a volume of €1.3 bn. That Norges was the largest investor in the previous 12 months will come as little surprise to anyone who has watched the €440 bn fund pull off some of the largest single transactions of the period. The largest, with a volume of €1.2 bn, was the 50:50 joint venture with global distribution specialist Prologis. The joint venture was established in December 2012 to own €2.4 bn of assets previously held by Prologis’ PEPR fund as well as some other properties. The Norwegians also invested over €800 mln in a sale-and-leaseback with Credit Suisse in Zurich, and along with AXA Real Estate invested over €780 mln in Germany. Data collated by PropertyEU Research indicates that the Norwegian fund has invested a total of €5 bn since its first joint venture on London’s Regent Street with the Crown Estate in 2010. The Norwegian fund is seeking to have at least 5% of its assets invested in real estate within a few years. To date it has carried out transactions in London, Paris, Berlin, Frankfurt and Zurich. The Prologis joint venture is Europe-wide. Cushman & Wakefield worked closely with NBIM on the deal. ‘We are massively impressed by the Norwegians; they haven’t really put a foot wrong yet,’ said Michael Rhydderch, Cushman & Wakefield’s head of capital markets. Rhydderch and David Hutchings, head of European research at C&W, noted that the SWF has a very long-term investment horizon. ‘They have put a huge amount of capital into the market and what makes them very interesting is that they are looking at European real estate on a ''grandfather basis'',’ Hutchings said. Norges was just one of an increasing number of Asian and Middle Eastern sovereign wealth funds piling into the market.

Click on the link below for full acces to Premium Content