The Teachers’ Retirement System of Louisiana is considering investments in Europe as part its real estate strategy.
The US fund is looking to add European real estate to its investments next year.
The pension fund is planning to invest up to $125m (€100.2m) in US and European real estate between now and June 2015, with all of the capital to be invested in funds.
Maurice Coleman, director of private markets for the pension fund, said the strategy would allow it to achieve an “additional layer of diversification” for both its real estate and total investment portfolios, while aiming for potential higher returns.
Deals with a value-added strategy are being targeted by the fund, which has typically made commitments of between $35m and $75m.
Coleman said leverage of around 55% could be used, compared with levels of around 35% for its core strategy.
Louisiana will be able to invest capital in funds focused on specific properties, as well as on multiple asset classes.
The pension fund, which had a real estate portfolio valued at around $1.4bn in September, is also considering co-investments – a strategy for which it is awaiting board approval.
With a mix of core, value-added and opportunistic investment strategies, real estate now makes up 8% of the fund’s total $16.4bn plan.
The investor has a 7% targeted allocation.
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