The Teacher Retirement System of Texas has approved a $200m (€179.5m) commitment to Starwood Capital Group’s eleventh opportunity fund.

The US pension fund is backing the manager’s XI Global fund, for which Starwood is looking at a $6bn equity raise.

Investors in the fund are projected to achieve net IRRs of 14-16%.

The commitment will give Texas Teachers some global real estate exposure, with the manager planning to invest half of the fund in Europe and half in the US.

Texas Teachers has now made $700m of commitments to Starwood’s opportunity fund series.

A $200m commitment into Fund IX in 2013 has yielded a 30.38% IRR since inception, while a $300m allocation into Fund X in 2014 has produced a 31.34% IRR since inception.

The latest vehicle will target major markets showing strong growth fundamentals.

Deals for the fund will include existing properties, new developments and debt secured by properties.

Targeted property types for the fund are hotels, industrial, office, retail and residential.

Starwood will find transactions either directly or in partnerships and joint ventures.

Texas Teachers has also invested capital with Starwood in three co-investments that have produced strong returns.

A $75m commitment into Retail Co-Invest Holdings 3 in 2013 has delivered a 14.06% IRR since inception.

A $50m commitment for UK Co-Invest in 2014 has produced a 41.26% return, and a $65m investment into the SCH TMI Co-Invest in 2015 has yielded a 58.54% return.