Pension funds pushing €400 mil. into building rental homes

Pension funds ABP and bpfBouw are pushing 400 million euros into building more than 1,500 affordable rental homes aimed at people struggling to find suitable housing, including older people and people who need care. The pension funds for civil servants and the construction industry think that they can help reduce the housing shortage while making an attractive return at the same time, AD reports.

The Netherlands has a significant shortage of rental houses in the middle segment, with rents between 650 and 960 euros. These are the rental homes teachers, police officers, and retirees can afford.

By entering the housing market themselves, pension funds ABP and bpfBouw think they can serve their target group twice. “By investing in affordable and sustainable rental or care homes, the premium money for this investment pays out twice,” ABP chairman Harmen van Wijnen told AD.

“We look for investments where we can achieve good return and provide a good pension, but also in a liveable world. ... We also want to have a social impact. Contribute to solving social problems, and the housing shortage is a huge one.”

bpfBouw has similar motivations, chairman Eline Lundgren told the newspaper. “It is important that you can live in a good world. Good and affordable housing is part of that. The gap between homes you can rent from corporations and the private sector is so big. This is right in between. It also fits well with our members.”

In addition to homes, the pension funds will also look at other “social real estate,” like schools and community centers. They’ll actively look at areas in urban environments that lack social facilities.

ABP and bpfBouw are joining forces with investor Bouwinvest, who will be responsible for realizing the projects under the name Dutch Social Impact Real Estate Partnership. ABP is investing 250 million euros, and bpfBouw 150 million euros. They may make additional investments in the future.