Norges Bank Investment Management (NBIM) is shaking up its organisational structure by absorbing its real assets investment operation into its equities management, in a newly-named active strategies department, and bringing all its energy investment together into one team.
NBIM, which runs Norway’s NOK19trn (€1.6trn) Government Pension Fund Global (GPFG), announced yesterday: “Norges Bank Investment Management is integrating its business areas that are responsible for real assets and equity investments.”
The adjustment was aimed at strengthening the management of both asset classes by bringing together people with complementary expertise, the central bank department said yesterday.
NBIM – which mainly invests in equities, but also bonds and to a lesser extent real estate and renewable energy infrastructure — said these changes would not affect the GPFG’s investment strategy across any of the asset classes.
“We will remain an active real estate investor and continue to buy assets when they are attractively priced and in line with our strategy,” NBIM said.
The Oslo-based investment manager said the organisational adjustment would also bring its energy investors together into “a more complete team that covers both listed and unlisted renewable infrastructure opportunities in this sector”.
“The ambition for this combined unit is to enable us to become a global leader in energy investing,” it said.
Mie Caroline Holstad, chief investment officer of real assets, has decided to leave the fund, NBIM said.
Holstad was appointed to the role in 2020 shortly after Nicolai Tangen took over as chief executive officer of NBIM, replacing Karsten Kallevig, who had previously headed up the separate subsidiary for unlisted real estate that NBIM set up back in 2014 – a time when it had high ambitions for the asset class it had first invested in three years earlier.
NBIM has since dialled back its emphasis on real estate.
In 2019 it axed the separate property arm, and reduced its target real estate allocation to 3-5% from 7%.
At the end of that year, unlisted real estate made up 2.7% of the fund, totalling NOK273bn. The value of that allocation has barely changed, standing at NOK307bn at the end of June this year, while the GPFG as a whole has grown considerably, and at the end of this year’s first half, unlisted real estate only comprised 1.7% of the sovereign wealth fund.
Holstad said that over the past four years, NBIM had had “continuous dialogue regarding how to best organise real assets and how to best utilize the competence within real assets and the wider organisation”.
“As the fund further cements its energy expertise and ambition, pulling on all areas of active management under one umbrella will also benefit the other parts of real assets,” she said.
The changes will take effect in January, with the new unit being re-named active strategies and being led by NBIM’s London-based co-CIOs for equities, Daniel Balthasar and Pedro Furtado Reis.
The pair will be in charge of all active investment in equities, credit and real assets, NBIM said.
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