UNITED STATES - Illinois Municipal Retirement Fund has become one of the first pension funds to transfer a separate account from Morgan Stanley Real Estate to another manager.

The pension fund has selected TA Associates to manage the account, after Morgan Stanley announced in December 2008 it was pulling out of the separate account real estate business.

At the time, MS said it felt it was better served to working only in the commingled funds business, such as its MSREF fund series which has had major interest on both the US and an international property stage.

Illinois' account with MS only contains US industrial assets, though they were valued at $201m (€147.4m) at the end of 2008 and are now valued at $188m.

The institutional investor already has a strong relationship with TA and believes the firm will be able to run the portfolio effectively in the future.

That said, there are several other pension funds yet to decide which real estate managers will takeover their former Morgan Stanley portfolios.

One of the largest of these is a $2bn separate account with the Florida State Board of Administration, which is understood to be still negotiating with potential managers of this account.

Florida first created its account with Morgan Stanley in 2003 and has since invested in a diversified US portfolio of office, industrial, retail and apartments across the country.

The Michigan Department of Treasury also has a $500m account.

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