Indiana Public Retirement System is investing $50m (€43.1m) with specialist hotel fund manager Noble Investment Group. 

The pension fund’s capital will be split between the two funds, Noble Fund IV-Income and Noble Fund IV-Value, according to a pension fund board meeting document. 

According to sources that track the capital raising, Noble is seeking to raise of $260m for the Income fund and $240m for the Value fund.

Last month, the real estate manager held first closings, raising $98m for the Income fund and $106m for the Value fund.

The vehicles are among a small number of funds in the market that target hotel investments exclusively.

Indiana PRS told IPE Real Assets:  “Noble Fund IV provides exposure to upscale limited service assets, which is expected to produce strong cash-on-cash yields and quality brand affiliations in healthy markets.”

Indiana’s real estate portfolio was valued in September at $1.76bn, or 6.4% of its $27.4bn in total assets. Its target allocation for real estate is 10%.