Apollo Global Management is raising $750m (€706.6m) for its latest vehicle, a non-core fund.

The manager is targeting a gross IRR of 18% for the US Real Estate Fund II, according to San Bernardino County Employees’ Retirement Association, a potential new investor in the fund.

The pension fund is weighing a $20m commitment to the fund, with a final decision due on 3 December.

The manager, which declined to comment, will co-invest 5% of the fund’s total equity, higher than the typical 2% contribution made by most general partners.

The fund will invest in middle-market properties across the top 25 US metropolitan markets, focusing on infill industrial, opportunistic office and hospitality repositioning and recovery.

The real estate fund manager has committed $338m of capital to transactions in the US.

A $50m commitment to industrial properties in Chicago, Atlanta and central Pennsylvania has been made, while a further $50m has been earmarked for assets in the San Francisco Bay Area and Los Angeles.

Apollo has also completed deals on single assets, investing in the Oakland Marriott City Center hotel in California.

The fund provided $32m of equity in the deal, with a total purchase price of $84m.

Fund II has also invested $55m of equity in the 1,242-room Hilton Atlanta Hotel in Atlanta, which will be refurbished.

The planned commitment by San Bernardino County is part of $35m to be invested in non-core real estate strategies for calendar year 2015.