UNITED STATES - The Illinois Municipal Retirement Fund (IMRF) has issued a request for proposal to hire non-core real estate managers and set aside at least $100m (€83m) for the mandate.
John Krupa, senior communications specialist, said: "The pension fund is making this move because it wants to increase its current real estate allocation of 2.8% to its long-term targeted allocation of 6%."
The scheme is likely to invest the capital in a number of non-core, commingled funds.
Krupa said: "The IMRF defines non-core real estate as not meeting the definition of core real estate.
"We define a core real estate investment as one with at least 80% of its portfolio leased or occupied, and less than 20% in a development, redevelopment or restructuring phase."
The pension fund does have both core and non-core in its current real estate portfolio.
As at 30 June, the IMRF had a non-core real estate portfolio that included 10 mandates with $255m in market value and $185m in unfunded commitments.
The managers of these portfolios include Rockwood Capital, Dune Capital Management and Cornerstone Real Estate Advisers.
One of its more recent new commitments to real estate was with Almanac Realty Investors, investing as much as $50m in Almanac Realty Securities Fund VI and $15m in Almanac Realty Securities Fund VI Sidecar II.
These funds make entity-level investments in public and private real estate companies.
The IMRF has invested $742m into real estate as at 30 June, representing 2.8% of the pension fund's $26.1 billion in overall assets.
The deadline for applications for its latest mandate is 8 August.
The fund said it aimed to make a final decision on the tender by 26 October.