PensionDanmark has put $200m into the vehicle, it said. Navigare has also invested in the fund – Maritime Investment Fund I – which will buy, lease, and sell ships.
Jesper Langmack, investment director at Danica Pension, said: “We are investing in a strong and experienced team with a broad set of skills, and this – together with the attractive price on new as well as secondhand vessels – is a key reason why we see this as a good investment.”
Torben Möger Pedersen, chief executive of PensionDanmark, told IPE that because the investment is very different from its other infrastructure assets, the pension fund is creating the new asset class of shipping within its overall €26.4bn portfolio in which to categorise the fund.
“The returns will probably be more volatile on a yearly basis than infrastructure investments, and will be heavily correlated with the world trade cycle, but over a business cycle we will generate a high return,” he said.
“From a risk point of view, it has more in common with private equity, but it is difficult to put it in one particular box, so we have decided to create the new asset class of shipping.”
PensionDanmark already has exposure to the shipping sector via its equities investments, he added.
“If this turns out to be a success over the coming years, we will be willing to put more into [the fund],” Möger Pedersen said.
With capital from the three founders, the new fund, Maritime Investment Fund I, will build a diversified portfolio of maritime assets including dry bulk, product, and container ships, as well as crude oil and chemical tankers. These will be leased out to operators on contracts of varying lengths.
The ships will be sold after a period of ownership depending on market conditions, PensionDanmark said.
The three parties said the fund would eventually invite other institutional investors to participate.
Möger Pedersen said the fund’s launch was the result of several months’ work.
“PensionDanmark has been in discussions with a range of parties within the shipping industry with regard to a cooperation in the maritime sector,” he said.
Infrastructure was the strongest performing asset class for PensionDanmark in 2016, generating 10.9% compared to the pension fund’s overall investment return for the year of just over 7%.