The World's Biggest Fund Is Getting Strong Returns From Real Estate
Norway’s Sovereign Wealth Fund, the largest in the world at $830B, is liking what it sees in New York and London’s real estate markets. On Wednesday the fund reported its results for 2015, and while overall returns were the lowest in five years at 2.7%, its real estate investments produced a solid 10%.
The Government Pension Fund Global has about 3.7% of its portfolio in real estate, most of that in New York and London, with smaller investments in Paris and Boston, Bloomberg reports.
Three-quarters of that investment is in unlisted real estate. The fund is looking at increasing real estate holdings to 5% of its portfolio, which should alleviate concerns about lowered foreign demand (at least somewhat).
“The strategy is to invest in a limited number of major cities,” the fund’s website states. The fund is also looking at investing in Tokyo and Singapore. [Bloomberg]
