UNITED STATES - Indiana State Teachers Retirement System will be looking at investing around $200m (€147m) into a new real estate strategy that will include international and opportunistic investments.
Robert Newland, the $5.5bn pension fund's chief investment officer, said it is seeking to invest in commingled funds as part of its targeted real estate allocation of 8% but has no plans to sell existing real estate assets to fund the move.
"We have already established a core and value-added presence in our real estate portfolio. The time has come to take the portfolio into other strategies. This will give us a wider range of diversification for our overall portfolio," said Newland.
The pension fund prefers the commingled strategy at this stage as it the amount invested is not large enough to consider a separate account investment vehicle while commingled fund managers already have the necessary experience of investing in these markets.
Indiana State Teachers has been committed to commingled funds with a core and value-added strategy for a while, one of the more recent deals being $45m with the PRISA fund, managed by Pramerica Real Estate Investors, which invests in established and leased office, industrial, retail and apartments.
Similarly, Indiana State Teachers has $45m invested in LaSalle's income and growth fund V, a valued-added commingled fund typically invested in the four main property types of existing buildings with the option, for example, of extra land that could be used for another phase in the future.