Two Dutch pension funds have invested €60m into a fund to redevelop parts of Amsterdam’s red light district, according to website PropertyEU.

The Dutch agricultural workers fund and Rabobank’s own pension funds have taken a 35% stake in a new public-private company set up by the city council and housing corporation Stadgenoot. The aim is to transform the area into an attractive residential neighbourhood and a vibrant hub for creative businesses and retailers.

The city has been attempting to clean up the area since 2007. The new company is called 1012 Inc after the district’s postcode and has a portfolio of 133 properties.

The pension funds have agreed to invest in the fund in return for the right to buy land for four residential developments outside the A10 ring road. The pension funds, represented in the deal by Syntrus Achmea, plan to build some 750 mid-priced rental apartments in these areas.