Dutch pension funds set for Asian property losses

The sector is set for large losses on private real estate investments this year, including those in Asia.
Dutch pension funds set for Asian property losses

As long-awaited sales of private real estate this year finally crystalise losses in the sector, Dutch pension funds are set for large losses on Asian portfolios, according to data from Netherlands’ central bank DNB.

ABP, the largest Dutch pension fund, invested €16.1 billion of a total global property allocation of €75.1 billion into APAC, at the end of 2022, according to its annual report.

Dutch pension funds collectively invest €13 billion in Asian property (a universe that is smaller than the APAC universe defined by ABP), of a total €158 billion global property allocation, DNB disclosed to AsianInvestor in response to a request for information. At the end of December, the Dutch pension fund sector had €1.43 trillion in total AUM.

In 2022, total listed property investments held by Dutch funds fell €15.1 billion or 26%. Those in unlisted property investments fell by just 0.7 billion, or 1.5%.

A March report by DNB pointed to the likely losses for Dutch pension funds’ holdings of private real estate this year.

“The price mutation of directly held real estate also lags behind, as the valuation of properties takes place only a few times during the year,” it said. 

Private investments make up the majority of Dutch pension fund property allocations.

In March, total AUM in private property investments was €114 billion: €47 billion in direct investments by funds themselves and €67 billion in domestic and foreign investment funds, according to DNB. Total direct investments comprised €44 billion in March.

2023 FALLS

First quarter data released by the largest pension funds show unlisted real estate investments falling.

At PFZW, the second largest fund, private real estate investments fell by 1.7% in Q1 2023, a total of €336 million, compared with a gain of 0.4% for listed real estate over the same period, according to its latest quarterly report. The fund has €19.77 billion invested in private real estate compared with €11.92 billion in listed real estate.

ABP’s property investments fell by 1.7% in the first quarter of 2023, a total of €800 million, according to its latest quarterly report, which did not separate listed from private investments. This compared with a 2.3% gain across the portfolio as a whole.

“The Q1 2023 updates for the five largest Dutch pension funds that show real estate lagging a bit,” said Anton Kramer, founder of OverRendement, a Dutch consultant.

Kramer also noted that last year’s sales of liquid assets have increased the proportion of illiquid assets held in portfolios, whose valuations are still unclear in some cases.

While listed property investments also showed a correlation with listed equities, Kramer said there should not be a big gap between these values and those of unlisted property.


Last year, major Dutch funds posted significant losses in property portfolios in 2022, including those in Asia, noting the concentration of these losses in listed investments.

APG lost 5.7% on its strategic real estate property portfolio, valued at €42.1 billion in and 22% on its tactical real estate portfolios, now valued at €7 billion.

“A sizeable portion of the portfolio is listed, and thus decreased in value over the past year,” noted APG’s 2022 annual report.

The losses in listed property investments for Dutch pension funds last year were accompanied by average losses of 18.3% on equities and 22.4% on bonds. But the impact of the 2022’s losses on the financial position of pension funds was relatively limited, as liabilities also fell sharply, by €375 billion.



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