First U.S. real estate investment for Norwegian fund
Direct investment in real estate offers clients opportunity for growth and diversification
NEW YORK--(BUSINESS WIRE)-- TIAA-CREF, a leading financial services provider, today announced a joint venture with Norges Bank Investment Management (NBIM), manager of the Norwegian Government Pension Fund Global, to invest in high-quality office properties in Boston, New York and Washington. TIAA-CREF owns a 50.1 percent share and will manage the joint venture. NBIM holds the remaining 49.9 percent share.
The joint venture is invested in several prime office properties measuring 1.9 million square feet and valued at $1.2 billion (approximately 6.6 billion kroner). TIAA-CREF and NBIM plan to co-invest in additional high-quality office properties in Boston, New York and Washington.
“NBIM is an excellent partner for us as we share a similar approach to real estate investing – a long-term investment horizon and an emphasis on large, high-quality assets in gateway cities,” said Tom Garbutt, head of global real estate for TIAA-CREF. “We believe direct investment in real estate and these principles add value for our clients over time. Our relationship with NBIM extends our real estate investment platform at a time when we see compelling investment opportunities, and it allows us to further diversify our portfolio.”
This investment marks NBIM’s first foray into U.S. real estate. “This is the fund’s first real estate investment outside Europe and is in line with our strategy to build a high-quality, global property portfolio,” says Karsten Kallevig, chief investment officer for real estate at Norges Bank Investment Management (NBIM), the fund’s manager. “We are very pleased to team up with a partner that has TIAA-CREF’s knowledge and capabilities and look forward to jointly developing the venture.”
Today’s announcement advances TIAA-CREF’s strategy to manage assets in partnership with sophisticated investors around the world. TIAA-CREF currently manages real estate investments on behalf of APG of the Netherlands and the Future Fund of Australia.
TIAA-CREF directly owns more than $19 billion in net assets (9/30/12) of primarily high-quality properties in the office, retail, industrial and multifamily sectors across the United States, Canada and Western Europe.
Today’s announcement enhances TIAA-CREF’s existing real estate portfolio. Real estate provides investors an opportunity to create long-term growth and diversification and a potentially stronger hedge against inflation compared to publicly traded equities and fixed-income investments.
NBIM safeguards and builds financial wealth for future generations as the manager of the Norwegian Government Pension Fund Global. The fund is invested globally in equity, fixed-income and real estate markets. It held assets worth 3,723 billion kroner, or about $650 billion, at the end of September 2012.
TIAA-CREF (www.tiaa-cref.org) is a national financial services organization with $502 billion in combined assets under management (as of 12/31/12) and is the leading provider of retirement services in the academic, research, medical and cultural fields.
TIAA-CREF Individual & Institutional Services, LLC and Teachers Personal Investors Services, Inc., members FINRA, distribute securities products.
Abby Aylman Cohen, +1-888-200-4062