3 Brilliant Ways Sovereign Funds Are Diversifying


With the growth of sovereign wealth fund assets slowing down due to low commodity prices, sovereign investors have been re-adjusting their portfolio strategies. For example, the Abu Dhabi Investment Authority (ADIA) have augmented hiring in the areas of institutional real estate. While others, like the Saudi Arabian Monetary Agency (SAMA), has terminated mandates to enhance portfolio liquidity. In this new era of low-oil prices, sovereign funds are expanding investment capabilities and hiring specialists to achieve the return expectations of their owners.

As many commodity-based sovereign wealth funds encounter funding pressures and capital withdrawals, a group of sovereign investors are looking to sell-off assets.

3. Sovereign Funds and Canadian Pensions Pivot to Indian Institutional Real Estate

While Norway’s sovereign wealth fund touted the opening of its Tokyo office to target core office real estate, a cadre of pensions and sovereign investors have pivoted toward India. In April 2015, Singapore’s GIC Private Limited, through Reco Berry Private Limited, acquired a 63.9% stake in Nirlon Ltd, an Indian property developer that owns a massive information technology complex in a Mumbai suburb. In June, Canada Pension Plan Investment Board (CPPIB), through its 2013 joint venture partnership with Shapoorji Pallonji Group, made its first acquisition, buying 100% of the securities of Faery Estates Private Limited, an Indian company which owns, operates and maintains SP Infocity IT Park in Chennai, India. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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