South Korea’s Public Officials Benefit Association (POBA) will invest 130 billion won (US$111 million) in a European logistics fund managed by the property investment arm of AXA Investment Managers, according to a local news report, quoting the pension fund’s Chief Executive Officer Gyeong-Ho Han.
Mr. Han told in a press conference in Seoul on January 2 that POBA will become the only Asian investor in the logistics fund when it injects the capital in the first half of 2020, The Korea Economic Daily says in the report.
It says the fund, which is overseen by AXA Investment Managers – Real Assets, has 1.4 billion euros ($1.56 billion) of logistics assets across six European countries.
It says the move comes after POBA in December joined German real estate manager Patrizia and Danish pension fund PFA to acquire a 1.2 billion euro logistics portfolio from Canadian property investment firm BentallGreenOak.
Spokespersons for POBA and AXA Investment Management could not be reached for comment.
Meanwhile, the January 3 news report also quotes Mr. Han saying that POBA had an investment return of 7.4% in 2019, better than its 4.5% target, and that the pension fund will continue to raise its allocation to alternatives or non-mainstream investments this year to meet its 4.2% target return for 2020.
He also says POBA, which manages the pensions and welfare of South Korea’s 250,000 civil servants, had 14.1 trillion won of assets under management at the end of 2019.
Siau Kean Yung, an analyst at investment consultancy Cerulli Associates, describes POBA as one of the “most aggressive” South Korean institutional investors in alternatives.
“The pension increased its alternative position from 49.2% in 2014 to 58% as of end-2018…Within alternatives, it’s more tilted towards real estate investments as it prefers income-generating investments over capital-gain investments,” Mr. Siau tells Asia Asset Management.
He says POBA prefers to invest in logistics assets via co-investments and joint ventures.
AXA Investment Managers had 757 billion euros of total assets as of June 2019.
