The Illinois State Board of Investment has increased its exposure to real estate by moving its targeted allocation from 10% to 11%.
Bill Atwood, executive director at the scheme, said the new allocation would mean it could have as much $150m (€133m) to invest in the asset class, focusing on two sectors in particular.
“One of these would be real estate debt,” Atwood said. “The other is to boost our exposure to non-US real estate investments.”
He said the pension fund would target Europe first and then later Asia.
Illinois State is planning to bring some real estate managers to its next board meeting for approval by the pension fund board, likely in September.
The scheme, which has a real estate portfolio valued at $1.7bn and total plan assets of $15.4bn, will be investing the capital through a fund or limited partnership structure.
Illinois State approved its first real estate commitment for 2016 with an investment of $50m in the H/2 Capital Partners’ Special Opportunities IV vehicle.
The commitment marks the first time the pension fund has invested with H/2 Capital Partners.
Opportunities IV is a debt-only fund, investing in the US.
Illinois State also has relationships with Oaktree Capital Management and Latitude Real Estate Investors.