DHL scheme awards non-listed mandate, but 'keeps control'
NETHERLANDS - Pensioenstichting Transport (PST), the €800m scheme for DHL Netherlands, has hired advisers Almazara to oversee management of its non-listed real estate portfolio.
The pension scheme, which also manages pensions for Deutsche Post's Dutch subsidiaries, awarded the mandate to oversee management of its largely core, income-focused indirect portfolio, but said it would remain in "full control".
ING Real Estate and AXA Real Estate manage PST's €100m real estate portfolio.
In a statement, PST controller Edwin Zwiers said the scheme was satisfied with the existing managers.
However, the scheme had been looking for a specialist team to advise on the entire investment cycle, covering both strategic and day-to-day issues.
Almazara partner Wietse de Vries, a former managing director at ING REIM, said: "Even if a pension fund invests in core, there will always be issues you need to address. Some funds will be facing expiry, for example, so you need to advise on whether it should be rolled over or liquidated.
"It was extremely important to this pension fund that it should be in control at all times.
"Control is becoming increasingly important for pension funds, especially given that the central bank is adamant pension funds should be in control of risks associated with alternatives."
The mandate announcement came as the Dutch central bank published a letter urging pension-fund investors in "innovative" assets - alternatives - to tighten up management environment it claimed had often failed to reflect the assets' complexity.
The letter, which follows a survey undertaken by the central bank with 35 Dutch investors, said: "The growth of these innovative assets is primarily motivated by a desire for diversification benefits and a higher expected return.
"At the same time, innovative investments are often associated with a high degree of complexity, higher administrative costs and a lack of liquid and transparent market prices."
The central bank also suggested that some pension funds had underestimated the potential costs of investing in alternatives, especially management, tail and liquidity risks.
"The added value of innovative assets is also not always sufficiently substantiated and justified," the letter said.