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The Government Pension Fund of Norway Purchases Properties in Spain & US

19/09/2014 – Expansion

The Government Pension Fund of Norway, the largest sovereign fund in the world carrying along a €680 billion worth of assets, strenghtens its bet on the real estate sector.

Few days ago, it sealed a deal with Boston Properties and obtained 45% in an asset lot valued at €3.135 billion in the United States. The portfolio inludes the property located at 601 Lexinghton Avenue and a 155.000-square meter office building (99% occupied) in Manhattan (New York), as well as two office skyscrapers in the downtown and the port of Boston.

The Fund fixed its focus on the real estate market in 2010 with an intention to diversify its investment portfolio. Planning long-term ventures, the sovereign fund strives at offices, retail parks and logistics hubs, expecting high returns from these assets.

With satisfactory number of properties in the U.S., the Norwegian fund scans the market of Spain in search of opportunities. It has just bought logistics assets in Madrid and Barcelona for €242 million in total. The property portfolio, acquired from Saba Parques Logisticos, includes a logistics hub in Coslada (62.000 square meters of warehouses and offices), a 14.7-hectare area in San Fernando de Henares and Camarma de Esteruelas, all nearby Madrid. In the region of Catalonia, it bought a 89.000 square meter logistics hub situated in the city of Penedes.

The transaction has been carried out through a joint venture company, held by the Fund fifty-fifty with Prologis.

Lately, other acquisitions by the Norwegian fund took place in Paris and London, on which it spent nearly €900 million.

Real estate investment brought the Fund a 3% return in the second quarter of 2014.


Original article: Expansión (by Ana Medina)

Translation: AURA REE