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.
The move follows commitments earlier this year to two opportunity funds managed by Blackstone and Rockpoint, respectively.
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.
