The property arm of Norway's oil-fueled sovereign wealth fund has reported that its investments in listed real estate returned 5.2% in the second quarter of the year.
Norges Bank Investment Management (NBIM) manages unlisted and listed real estate investments for the fund under a combined strategy. Investments in unlisted real estate investments amounted to 2.6% of the fund at the end of the second quarter and returned 1.9%.
In April, the fund sold eight logistics properties in France, the Netherlands and Spain held in partnership with Prologis, receiving €40.5 mln for its 50% stake.
In June, the fund acquired the leasehold interest in 30 Warwick Street in London alongside The Crown Estate. The fund paid £28.8 mln (€32 mln) for its 25% stake.
According to NBIM, the return on unlisted real estate investments depends on rental income, operating expenses, changes in the value of properties and debt, movements in exchange rates, and transaction costs for property acquisitions and disposals.
Measured in local currency, rental income net of operating expenses made a positive contribution of 0.9 percentage point to the return in the second quarter, and changes in the value of properties and debt contributed 1.0 percentage point, while transaction costs and currency movements had only a marginal effect.
As of June 30 2018, the fund's unlisted real estate investments amounted to NOK 220 bn (€22.7 bn) while its listed real estate investments stood at NOK 77 bn, representing a total of NOK 298 bn.