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Lessons from Danish pensions sector

18 February 2014

Anthony Lane considers how UK pension funds looking to invest in infrastructure can learn from Denmark

In Denmark, hardly a week goes by without a pension fund announcing that it is buying an infrastructure asset or increasing its overall allocation. Industriens Pension, which signed a PPP to construct a hospital wing at the end of last year, plans to double its allocation, while PKA intends to increase its total investment in infrastructure from £660mn in 2013 to £1.8bn over the next few years.

"Infrastructure is proving very attractive up here in Scandinavia," confirms Casper Hammerich of Danish consultancy Kirstein, which conducts an annual survey of Nordic pension fund allocation intentions. "If we look at the survey data, interest in infrastructure is mainly a Danish thing – that's where we see the highest interest. It's where we've seen the most investors commenting on various infrastructure projects, mainly greenfield projects."

The standard-bearer for this government-pleasing charge into alternatives has been the £16.5bn PensionDanmark fund, the largest in Denmark,...