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Norwegian Sovereign Wealth Fund Sets Eye on Asia Real Estate Market

Since the fund got the permission to enter the property market in 2010, it has performed well with a high return. The fund owns properties in Times Square and  the Champs Elysees and is thinking to expand the investment globally.

To “reduce the probability of making really big mistakes,” Kallevig said to Bloomberg that the fund is looking to invest in Washington, San Francisco, New York and Boston. In Europe, it’s targeting London, Paris, Munich and Berlin, he said. No specific cities in Asia were mentioned. But its efforts to enter Asia are about to intensify, said Kallevig. The fund will pick two cities in Asia and the selection will use the same criteria as it has used in Europe and the US.

Will they pick Beijing or Shanghai? Probably. Several Chinese main media, Tencent, Sina and NetEase have reported the Norwegian sovereign wealth fund’s plan, with a detailed introduction on the fund’s successful performance. Sina called the Norwegian fund new pushing hands behind Asian housing price. The fund also announced that it was seeking to raise investments in China stakes last month.

However, the fund also reported its loss in China due to its slowdown of growth, from 7.7 percent in the fourth quarter to 7.4 percent the first quarter this year, according to Bloomberg. There are other options in Asia. Singapore ranks third in the 2014 World Competitiveness Yearbook made by Swiss business school IMD, only behind the US and Switzerland. Hong Kong, dropping from its top spot in 2012, still holds fifth this year. Taiwan ranks 13th position. The mainland of China falls from 21st to 23th, while Japan takes the 21st spot this year.

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