GLOBAL - The Illinois Municipal Retirement Fund has hired Cornerstone Real Estate Advisers and INVESCO Real Estate as core open-ended commingled fund managers.

According to Illinois Municipal officials, the companies were selected due to their organisational structure, performance history, investment strategy and fees.

The pension fund had done an RFP search for additional open-ended core managers - the third finalist for the assignment was AEW Capital Management.

Illinois Municipal had previously stated it felt there would be strong investment opportunities in core assets over the next couple of years.

The total amount of capital allocated for the search was $150m (€107m), which will be split evenly, with each manager being awarded $75m.

The Cornerstone Patriot, which has total assets of more than $1.1bn, is a commingled fund that has had some recent success in closing deals, including the purchase of three deals - apartment properties in New Jersey and Denver and an industrial asset in Dallas.

Half of any commitment will go into the commingled fund right away. This capital takes out part of the co-investment made to the commingled fund by Cornerstone's parent company, Mass Mutual Life Insurance Company.

The other 50% of each investor's commitment will be called down by the manager as purchases of properties are completed.

Illinois Municipal funded the INVESCO Core Real Estate fund - a core, open-ended commingled fund - by using a combination of funds withdrawn from cash and the NTGI Barclay's Capital Aggregate Bond index.

The pension fund had previously invested in core open-ended commingled funds with commitments to the Prime Property fund run by Morgan Stanley Real Estate and the BlackRock Granite Fund overseen by BlackRock Realty.

Illinois Municipal had a real estate portfolio valued at $461.6m as at 30 September. 

Its total plan assets were $23.5bn for the same period, while the targeted allocation for real estate is 6%.
 

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