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Swedish buffer fund AP2 in $1bn real assets drive

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AP2 has committed more than $1bn (€760m) to real assets, according to its half-yearly report.

The second Swedish National Pension Fund announced respective commitments of $750m and $265m to agriculture real estate and US real estate.

The commitments follow AP2’s 2013 decision to increase its investment in unlisted real estate from 10% to 15%.

The larger of the two commitments was made to US fund manager TIAA-CREF, with Australia, Brazil and the US targeted for investment.

In 2011, AP2 invested $250m with TIAA-CREF in a purpose-built venture, buying and managing agricultural assets and focusing primarily on grain production.

At the time, AP2 said it made the decision to invest in agricultural real estate to provide stable returns with low correlation to its existing investments.

The following year, AP2 and TIAA-CREF increased their commitments to the venture to $2bn, with Canadian investors also joining the Global Agriculture company.

AP2’s second, smaller investment, meanwhile, is part of a joint venture with South Korean pension fund NPS and Tishman Speyer.

The trio have worked together before.

In late 2012, AP2 bought a 41% stake in property company US Office Holdings, jointly owned by NPS and Tishman Speyer.

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