The Kansas Public Employees Retirement System (Kansas PERS) is planning to invest as much as $195m (€184.2m) in real estate in 2017, according to a board-meeting document.

The real estate commitments will be split, with up to $155m invested in non-core and $40m in core real estate.

The capital will be part of a 2% allocation increase to real estate over two years.

Kansas PERS has a 9% allocation to real estate that will be increased to 10% by 2017 and 11% by 2018.

All of the capital will be invested through funds, either in the US or abroad.

Investment decisions will be made in conjunction with investment consultant the Townsend Group.

The pension fund believes that, by 2017, it will be close to its long-term target for core real estate.

Townsend is of the opinion that non-core strategies offer the potential for attractive risk-adjusted returns.

In a board meeting, it cited the reduced availability of distressed assets and a desire to conserve “dry powder”, to be invested following an eventual downturn.

Townsend would like the pension fund’s primary focus to be on specialists that can manage assets and capital structures effectively.

It may also pursue funds that have portfolios with embedded gains.

Kansas PERS and Townsend remain selective on fund commitments.

Townsend wrote in a board-meeting document that Kansas PERS had historically invested in less than 3% of available investment opportunities.