Pensions insurer Varma, Finland’s second-largest pension fund, is working on a major new primarily residential development in the country’s capital, in which it is set to invest between €50m and €100m over a number of years.

The €42bn pension provider is using the factory site of tableware manufacturer Arabia to the north-east of Helsinki’s city centre – a property it has owned since 1992 – as the location for the biggest re-development project going on in the city right now.

lkka Tomperi, Varma’s investment director responsible for real estate, said: “This is one of the largest assets Varma owns, and the redevelopment of it is a very significant project for us. 

“Varma’s intention is to enhance the overall attractiveness of the location, having successfully worked the same way in Tampere, where we own the old Finlayson cotton mill area in the heart of the city.”

The Arabia district around the old factory has been rapidly developing over the past 10 years into a desirable residential area next to the sea, he said.

The current leasable area of the development site, called Arabia135, is around 105,000sqm. 

In future, the area could consist of rental apartments, student and senior housing for-sale residential, hotel space as well as retail premises, restaurants, cafés, leisure facilities, sports and cultural premises, while keeping most of the asset as offices and for educational use, Varma said.

Over the last couple of years, Varma has developed 210 rental apartments on the site in two blocks of flats.

The Arabia135 property is leased to Aalto University and the Finnish company Fiskars, which owns the Arabia brand as well as glassware brand Iittala, and recently bought Waterford, Wedgwood and Royal Doulton.

Fiskars still has its headquarters in the Arabia building where Arabia ceramics used to be produced, and the building also houses the company’s Iittala shop and the Arabia museum.

Aalto University has decided to move out of the Arabia district, vacating space that Varma will renovate and then partially let to the Metropolia University of Applied Sciences and the Pop & Jazz Conservatory.

In a design contest organised by Varma, work by architect firms Anttinen Oiva Arkkitehdit and Verstas Arkkitehdit won out of nine competing firms, and Tomperi said the best elements of the winning designs would now be merged to create a complete plan for the Arabia135 development.

When the change of use-related zoning process is complete, Tomperi said Varma would be able to start work on the development in 2018 but added it would take years to finish the whole project.

“Organising an architectural contest was a new way for Varma to start a major redevelopment process, but we feel it was also a great way for us to get multiple innovative ideas on how to take this project forward,” he added.

Varma involved local residents and current and future tenants of the asset in the process by attending a local outdoor festival and by showing the competitors’ designs publicly and gathering locals’ views on them, he said.