The Norwegian Pension Fund Global has made its first real estate investment in the US, buying almost 50% of five office properties owned by TIAA-CREF.

The fund bought a 49.9% stake in the properties, based in New York, Washington D.C. and Boston, which are valued at $1.2bn.

As part of a joint venture with TIAA-CREF, the Norwegian fund will look to acquire additional office properties primarily in the three cities mentioned.

"This is the fund's first real estate investment outside of Europe and is in line with our strategy to build a high-quality, global property portfolio," said Karsten Kallevig, chief investment officer for real estate at Norges Bank Investment Management.

Two of the properties are located in New York, two in Washington D.C. and one in Boston.

"As the world's largest real estate market, the US will be an important part of the fund's long-term property portfolio," said Kallevig. "We will initially seek to invest in key east-coast cities."

The fund made its first real estate investments in 2011 in office and retail properties in London and Paris. It is mandated to hold 60% in equities, 35-40% in fixed income and as much as 5% in real estate.

First published 12.02.2013

monique_simpson@wilmington.co.uk