Teachers’ Retirement System of the State of Illinois is evaluating real estate debt and is looking to increase its exposure to value-add strategies.
The pension fund confirmed to IP Real Estate that it plans to make $750m (€657m) of new commitments over the next 12 months, investing $250m in value-add strategies, $400-500m in opportunistic strategies and up to $100m in co-investments.
The majority of Illinois Teachers’ existing real estate exposure is in the form of core investments, representing 71.6% with a market value of $4.19bn. Its value-add and opportunistic investments represent 11% and 17.4%, respectively.
The exposure to value-added investments is likely to increase as the pension fund considers new value-add funds and allows its core separate account managers to move into value-add investments by up to 25%.
But the pension fund said it would invest across the risk spectrum as it seeks to reach its long-term real estate allocation target of 15%.
Illinois Teachers will also be evaluating real estate debt strategies and look into placing more capital with emerging real estate managers.
At the end of March, its real estate portfolio was value at $5.86bn, representing 12.9% of the pension fund’s total assets.