Norway’s $2 trillion sovereign wealth fund is taking a conservative approach toward data centre investments, citing heightened sector volatility, according to Alexander Knapp, the new Head of Real Estate at Norges Bank Investment Management (NBIM).
“We don’t have any active plans to invest in data centres… sectors that are volatile, we’re very careful with,” Knapp said, noting that NBIM’s priority is enhancing long-term returns without taking undue risk.
NBIM currently holds stakes in listed companies that own data centres but has no direct exposure.
🔹 A Shift in Real Estate Strategy
NBIM has launched a new property strategy focused on expanding beyond major global cities into broader regions across Western Europe, the U.S., and Canada.
This could include direct stakes in residential real estate, including rental housing and student accommodation, which have attracted increasing interest from institutional investors.
The shift comes as NBIM acknowledges underperformance in its property portfolio:
- Real estate return (H1 2025): 1.8%
- Equities: 6.7%
- Bonds: 3.3%
As of June 30:
- $36.09B invested in unlisted real estate (1.86% of fund value)
- $32.80B in listed real estate (1.69% of fund value)
- Unlisted real estate return: +4.0%
- Listed real estate return: –0.5%
🔹 Industry Backdrop: Booming but Uncertain
Demand for data centres is expected to surge — particularly in the U.S. — as Microsoft, Amazon, and Google build AI-related infrastructure.
However, some investors worry the rapid buildout could be unsustainable.
NBIM’s response: focus on measured growth, stronger diversification, and a more integrated public–private real estate portfolio.