ABP could profit from real estate bidding war

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THE NETHERLANDS - The €209bn civil service pension fund ABP could enjoy a windfall as a result of a bidding war between two large property investors in the USA.

Last week, a syndicate led by listed property investor Vornado Realty Trust made a €29bn counter bid (including €12bn of debt) for Equity Office Properties (EOP), the largest offices investor in the US, in which ABP is a shareholder.

The bid came after EOP had accepted a €28bn bid from the €52bn private investor group Blackstone in November.

For years, ABP has been holding a stake of almost 4% in EOP, as part of its €10bn US real estate portfolio, spokesman Thijs Steger confirmed to IPE.

ABP is also shareholder at Vornado, in which it is holding a stake of over 4%, he said.

The €81bn healthcare scheme PGGM used to have a stake of up to 8.5% in EOP, but has largely sold its shares now, spokeswoman Ellen Habermehl said.

"We have significantly decreased our stake, because of the procyclical character of the fund, which doesn't fit our long-term strategy any longer," she explained.

Until a year ago, when he joined merchant bank NIBC, Jan van der Vlist represented PGGM on EOP's board of trustees.

The €13.1bn EOP is the largest publicly held office building owner and manager in the US. Its portfolio comprises of almost 590 buildings, totalling 10.5m m2 of office space in the country's major metropolitan markets.

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