More than half of pension funds in Norway, Sweden and Denmark intend to increase their holdings in non-listed real estate over the next five years. In a survey put together by Lymos BV Real Estate Capital Advisors, 59% said they would increase their investments in the asset class. The average increase in allocations was 12%.
Furthermore, most Scandinavian funds described their involvement with non-listed real estate holdings as very active. However, 73.9% of respondents said they did not execute a financial hold/sell analysis and 18.2% do not execute a strategic hold/sell analysis.
Individual market policies also appeared to play a larger part in funds' decision-making than day-to-day rational analysis. Most funds said they did not consider ending their closed-end non-listed real estate investments before the termination date, largely due to internal political reasons.
Mariette Meulman, author of the report, said: "There is now much greater interest in non-listed real estate assets. The requirements of pension funds in this area call for further analysis, particularly as there is so little information available."
The survey interviewed 46 Scandinavian pensions each with assets under management of at least