Government Pension Fund Global: Gradually expanding the portfolio
Norges Bank Real Estate Management invested 15 billion kroner in unlisted real estate in 2017. The year marked our first investment in Asia.
Today, we publish extended information on the unlisted real estate investments of the Government Pension Fund Global. The publication contains previously published data, but provides more detail. It explains our results, our investments in different sectors and cities, as well as our investment process and risk management. The publication also presents details related to our income and costs.
The highlight of 2017 was our first investment in Asia. In December, we acquired a 70 percent interest in five properties in Tokyo, Japan. At the end of the year, the fund's unlisted real estate investments were therefore split between three continents for the first time – Europe, the US, and Asia.
"Our Tokyo investment was in line with our strategy to build a global portfolio of high-quality assets that we believe will produce good long-term return", says Karsten Kallevig, CEO of Norges Bank Real Estate Management.
The fund's unlisted real estate investments returned 7.5 percent in 2017.
"We are pleased with the results for 2017, however, we do not put too much emphasis on a single year. Returns will vary from year to year, and longer time series give a better understanding of the performance of our assets", says Kallevig.
Investments in unlisted real estate had a market value of 219 billion kroner and amounted to 2.6 percent of the fund at the end of 2017.
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