NORTH AMERICA – The Contra Costa County Employees Retirement Association (CCCERA) is looking to invest more than $240m (€184m) of equity into real estate this year.
In a board-meeting document, the pension fund said it had not invested any new capital into the asset class since late 2011.
Its ability to commit to private real estate has grown, it said, due to the increase in total plan assets at CCCERA and meaningful distributions from existing private real estate managers.
CCCERA is still undecided whether it will commit capital through existing managers or new managers, but it said all new investments would be made through commingled funds.
The pension fund said it was not looking to allocate capital into core, where it said much of the real estate capital had been raised in the US since 2008.
It pointed out that many investors had focused on this strategy as they became risk-averse after losing substantial capital in non-core assets after the financial crisis.
CCCERA thinks the best real estate investment opportunity is in the distressed sector, and that it expected more properties with problem loans to be unloaded onto the market, creating "tremendous" real estate opportunities.
The pension fund is therefore planning to award the largest allocation – as much as $155m – to distressed commingled funds.
Approximately $60m has been earmarked for value-add and $25m for opportunistic.