Denmark’s DKK50bn (€6.7bn) pension fund Lønmodtagernes Dyrtidsfond (LD) has said it expects to see tough competition between asset managers for the DKK23bn of fixed income mandates it is putting out to tender.Lars Wallberg, LD’s director of finance, said: “We have worked on our investment strategy over the last few years and varied our expectations slightly for the bond portfolio.”LD will target a high level of safety in the portfolio, he said, to avoid exposure to credit risk and price volatility.At the end of April, the fund issued invitations to tender for two DKK9bn Danish high-grade bond mandates and one to tender for a Danish short-term bond mandate. This followed two invitations to prequalify for the investment management of a European corporate investment-grade bond mandate and a global inflation-linked bond mandate. LD said both Danish and foreign managers had the opportunity to make offers to provide investment advice on the mandates that the scheme has now put out as an EU tender.Wallberg said the two mandates for gilt-edged bonds and the mandate for Danish short-term bonds would require a high level of knowledge of Danish bonds, adding that this meant the number of managers applying for the business was likely to be relatively limited.But he said he expected tough competition among managers because these were large, attractive mandates.LD, which receives no current contributions, manages cost-of-living allowances that were granted to public sector employees in the past.Meanwhile, the Danish financial regulator has given PFA’s asset management arm an official order and criticised the firm for paying too much for services from another part of the PFA group.The Danish FSA (Finanstilsynet) ordered PFA Kapitalforvalting (PFA Asset Management) to ensure the agreement with PFA Pension to receive various administrative services includes fees that are set at market rates.The order was given following a routine inspection of the firm.The regulator said: “It is the FSA’s judgement that the company has not focused sufficiently on the fee for services that are included in the administration agreement, and that the fee is high.”It said this meant there was an increased risk the agreement had not been made according to market rates.PFA said it would follow the order but insisted the fee had been in line with the market.In a statement, PFA Kapitalforvaltning directors Jesper Langmack and Poul Kobberup said: “We will obviously listen to the FSA order and in future ensure we can account for the fee in detail, which we believe to be market-based.”They also said they had tried to ask the FSA what it believed would be a correct level of fee, but the authority had not given it an indication of this.Separately, PenSam said it and Topdanmark were jointly investing DKK600m in a residential development of 400 flats in Aarhus.Construction of the planned development in the city’s new harbour-side quarter known as Aarhus Ø is about to start, PenSam said.The first 120 apartments are expected to be ready for occupation in October 2015.Benny Buchardt Andersen, PenSam’s investment director, said: “It is positive that we as a pensions company can support the development of Aarhus by creating attractive homes, which will provide value now and in the future.”He said the investment would mean more employment, high-quality homes for the city and a good return for PenSam’s customers.NCC Construction is to be the lead contractor for the project.Lastly, Industriens Pension said it was making its first property investment in the Aarhus area, putting DKK140m into a new office building currently under construction in Skejby to the north of the city.The property is already pre-let on a 10-year lease to the Danish IT company EG.The pension fund said it would take over the property in the spring of 2015 when it was completed and the tenant had moved in. The property was just under 12,000m2 in size and included underground parking, Industriens said.Peter Frische, head of real estate investment at the labour-market pension fund, said: “This is a modern, flexible and well-located high-quality property with a good tenant and a long lease. The investment will contribute to securing a good and stable long-term return for our customers.”Industriens said it planned to invest DKK5bn over the next few years in Danish property. It currently has DKK2.8bn invested in property funds, primarily abroad. This compares with its total investments across asset classes of DKK118bn.