The Nikkei newspaper has reported that the Pension Fund Association, the largest private pension fund in Japan, would start to invest in real estate development projects from 2008.
“The association will work with major real estate developers to build high-rise office buildings and other commercial facilities, targeting to grow their assets by rent income from tenants,” says a Mizuho spokesman. “The association plans to invest up to 5 percent (JYP 650 billions) of its current assets of JPY 13 trillion into real estate projects.”
The associations investment is now almost limited to stocks and bonds. But in the US, many public pension funds such as CalPERS, the California Public Employees Retirement System, invest more than 10 percent of their assets into real estate projects.
Due to the recent upturn of land prices, and recent development of investment schemes for reducing risks such as REIT, the association announced in March 2007 that they would set out to adopt investment in real estate development.