GLOBAL - Nevada Public Employees Retirement System has drawn up a shortlist of managers to replace BlackRock Realty with either AEW Capital Management or Heitman to take over an existing $613m (€483.3m) portfolio.

The $26bn pension fund will be interviewing AEW and Heitman at a board meeting on 20 June, with a final decision on the account to be made by the retirement board on the day. 

The choice to bring in the two firms was based partly on the recommendation of the pension fund's real estate consultant, San Francisco-based Callan Associates.

Dana Bilyeu, executive officer with the fund, said of the change in managers: "There was a change in the direction of the separate account portfolio, and BlackRock wanted to go in a different way."

The separate account relationship between Nevada PERS and BlackRock began 11 years ago, with the manager selected to take over only awarded the existing portfolio, with no additional equity allocations planned.

The value of the portfolio was based on where the portfolio stood as of the end of March 2012.

BlackRock has so far been overseeing a core portfolio, with assets spread out across major metropolitan markets in the US. 

These include a combination of office buildings, industrial properties, shopping centres and apartments.

Nevada PERS decided to bring in either AEW or Heitman as BlackRock's replacement at a board meeting in mid-May.

The fund only invests in real estate through separate account managers and currently has no commingled fund investments, with the second account of similar size to BlackRock's overseen by Dallas-based Invesco Real Estate.

At the end of March, Nevada PERS had a real estate portfolio valued at more than $1.2bn, or 4.7% of its $26bn of total plan assets.

Its allocation still falls far short of its targeted allocation of 6.5%, which would amount to a $450m increase.