Large Russian pension fund helps seed a new REIT

PIK Group, a Russian real estate developer focusing on large scale residential projects, has won Blagosostoyanie, one of the largest Russian non-governmental pension funds, as an initial investor in its first ever Russian-regulated real estate investment trust (REIT).

The investor’s initial allocation amounts to over RUB310m (€7.8m). The total side of the pension fund is RUB227.7bn at April 1, so at this initial stage the investment comprises a small proportion of total assets.

The investment vehicle is part of the PIK Retail programme launched last autumn, which aims to improve the lifestyle quality in the residential districts it invests in through property management projects. Previously commercial properties were sold to retailers piece by piece, but the new scheme allows unified ownership of properties and centralised property management. The PIK Retail portfolio holds around RUB2bn in assets.

Yuri Novozhilov, chief operating officer of Blagosostoyanie said: “The fund’s investment policy is to pay special attention to the real economy sector, which provides security, liability and profitability of long-term pension money investments. The PIK Retail programme meets all these requirements, simultaneously playing an important social role in improving the infrastructure of Moscow and the Moscow region.”

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