ATP signs off €700m for indirect real estate investments
DENMARK - Denmark's largest pension fund, ATP, has allocated a further €700m to invest in real estate funds, joint ventures and club deals through its subsidiary ATP Real Estate.
ATP Real Estate Partners was established in 2006 and has since then built up a portfolio of investments in 30 real estate funds in Europe and the US, valued at DKK6.4bn (€859m) at the end of 2009.
The pension fund has been devising its new real estate strategy over the past few months and established a follow-on investment entity, ATP Real Estate Partners II.
The investment programme will last three years and is expected to be more risk-averse than its predecessor and consequently hold a larger allocation to core real estate.
ATP Real Estate will continue to focus on Europe - including central and eastern markets - and the US, but it will also consider joint ventures and club deals, as well traditional non-listed funds.
The pension fund has been increasing its exposure to the US in recent months. In October 2010, Michael Nielsen, managing partner at ATP Real Estate, told IP Real Estate ATP was close to signing off on commitments to core US real estate funds following a 12-month due diligence process.
ATP Real Estate has since revealed that, at the end of last year, it made an investment in Brookfield Asset Management's Real Estate Turnaround Programme, an opportunistic strategy targeting investments mainly in the US.
The pension fund gained access to the strategy by committing $50m (€38.7m) to The Townsend Consortium fund, the sole purpose of which is to invest in Brookfield's investment programme.
By setting up the fund, the Townsend Group has been able to invest the capital of ATP and other clients in the Brookfield strategy alongside large sovereign wealth funds, China Investment Corporation (CIC) and Australia's Future Fund.
The Brookfield fund will potentially be active in most property sectors, including office, residential and retail.