DENMARK – Five top Danish pension funds worth around 45 billion euros have set up a real estate “club” to invest in European indirect property vehicles, says real estate firm Cushman & Wakefield Healey & Baker.
The firm, which is advising the schemes, said the funds involved include PKA, Pen Sam Livforsikringsaktieselskab, Kommunernes Pensionsforsikring, PFA Invest International and Finanssektorens Pensionskasse.
Cushman & Wakefield Healey & Baker said they have would invest up to 250 million euros a year in European indirect property vehicles outside Denmark over the next three to five years.
It said: “This is the first time major pension fund investors have collaborated in this way to invest in European indirect property vehicles.” The group would target indirect real estate vehicles focused on core and core plus investments across all industry sectors in the European Economic Area.
The Danish Real Estate Club will not make investments itself, and this is not a Fund of Funds. The Club is structured to allow Members to collaborate on particular fund investments whilst achieving significant benefits such as shared due diligence costs; knowledge and experience; collective representation on Fund boards; shared market information and investment strategy.
The club will be chaired by Kommunernes’ Henrik Kolind in the first year.
He said: "Currently our domestic property weighting is too heavy and we are seeking to spread risk through indirect property investment across Europe. The market is growing rapidly and our collaborative Club model gives us considerable flexibility and power to seize the right opportunities whilst enjoying the benefits of shared resources, knowledge and experience and of course, a reduced cost base."
"Real estate will play an increasingly important role in overall asset allocation decisions with investment into indirect property vehicles being more prevalent in the future,” said Bryan Laxton, managing director of C&W/H&B Finance.
“We believe C&W/H&B has a unique ability to advise on indirect property vehicles across Europe and we look forward to working with the club members on their individual strategies and wide ranging pan-European indirect investment programmes."