The New Jersey Division of Investment is considering a $100m (€92m) commitment to a Blackstone debt fund.
The manager’s Real Estate Debt Strategies III vehicle is being considered by New Jersey and its real asset consultant, RVK, according to recent board meeting documents.
The fund manager declined to comment.
Blackstone is targeting a $4bn capital raise for the global fund and will co-invest $50m, as well as a further 10% on each investment.
The fund will lend to new borrowers, banks with legacy commercial real estate exposure and finance liquid real estate debt investments.
The manager’s first debt fund generated a 12% net IRR. The latest fund has a current debt yield of 8.8%, as of June last year.
Blackstone is focusing on portfolio transactions and larger assets for the fund, which will invest in Europe, Asia, Australia and Latin America.
New Jersey’s current debt investments are in mid-market properties.
The pension fund stated in a board meeting document that Blackstone has produced attractive income returns on its previous debt funds, with only limited legacy issues and no realised losses.
New Jersey has room in its real estate debt allocation for new commitments, with 0.55% of its real estate portfolio below its target allocation for debt real estate of 0.80%.
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