NORTH AMERICA – The Teachers’ Retirement System of the State of Illinois has approved new real estate commitments totaling $250m (€181m).
One of the commitments was a $100m allocation to the Oaktree Real Estate Debt Fund.
The fund will be making debt investments on a global basis, including performing CMBS securities, first mortgages, junior secured debt and mezzanine debt.
Most of the deals will involve the traditional property types of office, industrial, retail and apartments.
The pension fund has placed the investment into its $6.3bn fixed income portfolio.
Oaktree manages another $327.6m worth of investments for the pension fund.
Illinois Teachers also allocated $150m to the Lone State Real Estate Fund III, a distressed commingled fund that will invest capital in Europe, the US and Japan for apartments and commercial real estate.
The pension fund has put this investment into its $4.7bn real estate portfolio, which means it has invested 12% of its total plan assets in real estate and has a long-term targeted allocation of 13% for asset class.
Illinois Teachers' investment strategy is to target multiple risk profiles.
The pension fund will consider investing in core, value-added and opportunistic strategies in either commingled funds or separate accounts.
In fiscal year 2013, the real estate portfolio produced a 12.6% rate of return, net of fees.
This compares with a 9.91% rate of return for 2012.
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