The Los Angeles County Employees Retirement Association (LACERA) is thinking to invest $800m (€701m) in real estate as part of its 2016-17 investment plan, according to a board meeting document.
The pension fund, however, expects its exposure to the asset class to fall by 1 percentage point when factoring in real estate disposals, the modest capital appreciation of its portfolio and the growth in its total assets.
LACERA will invest the capital through new and existing separate account managers, including Capri Capital, Deutsche Asset Management, Invesco Real Estate, TA Associates, Clarion Partners, Heitman and Stockbridge Capital Group.
Investment staff will “release” the capital periodically for investment in core, value-add and high-return opportunities throughout the year, as deemed appropriate based on deal flow and other portfolio needs.
LACERA is to continue to invest in apartment, retail and industrial properties, while being extremely selective on any new office investments.
It also plans to increase international real estate exposure to 15% of its overall portfolio for the asset class.
In September of last year, the pension fund had $318m invested in international real estate, representing 5% of its total real estate portfolio.
All the capital was invested through commingled funds, and more than half – $178m – was focused on Europe.