Teachers’ Retirement System of Louisiana (TRSL) is investing $50m (€44.4m) in Oaktree Capital’s latest global opportunity fund.
The US pension fund made the commitment to Oaktree Real Estate Opportunities Fund VII on the recommendation of investment consultant Hamilton Lane.
According to a TRSL document, Hamilton Lane has provided data to show Oaktree had been a strong performer with its previous funds.
The real estate manager produced a 29.1% gross internal rate of return and a 1.1x gross multiple on its realised investments for its Real Estate Fund VI, as of March this year. For the same time period, the overall performance of the fund has yielded a 14% net IRR.
Oaktree is looking to raise $3.5bn for Fund VII. It recently attracted $200m from the Teacher Retirement System of Texas.
The fund will employ a variety of strategies around the world, although 75% of investments will be made in the US, with the remainder in Europe and Asia.
Fund VII is targeting a 20% gross returns and 16% net returns and will employ a maximum 80% loan-to-value ratio.
Oaktree is planning to make 140 to 170 investments for the fund. No single asset can make up more than 20% of the fund.
Property values for assets are likely to average between $30m and $200m. Oaktree expects each investment will be held in fund for three to five years.