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Norway Wealth Fund Gets Approval to Buy Property Outside Europe

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Dec. 21 (Bloomberg) -- Norway’s sovereign-wealth fund, the world’s largest, received government approval to buy property outside of Europe.

“We are now opening for investments in real estate in the whole world,” Finance Minister Sigbjoern Johnsen said in a statement today. “By spreading investments we are contributing to a continued safe and long-term management of the fund.”

Norges Bank Investment Management, which runs the $680 billion fund, can choose to invest in real estate abroad as it sees fit, Norway’s finance ministry said in a statement today. The fund had been only permitted to invest in securities outside of Europe.

Built from Norway’s oil and gas wealth, the fund in 2010 received approval to invest as much as 5 percent of its capital in real estate in a bid to meet a 4 percent return target. It has since bought properties in France, U.K., Germany and Switzerland.

The fund wants a third of its property investments to be in the U.S., Yngve Slyngstad, chief executive officer of Oslo-based NBIM, said on Dec. 1. The fund held 0.3 percent in real estate, 60.3 percent in stocks and 39.4 percent in bonds at the end of September, according to its quarterly report.

To contact the reporter on this story: Dalia Fahmy in Berlin at dfahmy1@bloomberg.net

To contact the editor responsible for this story: Andrew Blackman at ablackman@bloomberg.net

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