GLOBAL - The Teachers’ Retirement System of Louisiana is planning on making $100m-150m (€78m-116m)) worth of commitments to opportunity funds in real estate over the next 12 months.
Phil Griffith, chief investment officer for the $11.3bn pension fund, said: “There is going to be investment opportunities from distressed owners or properties that have seen a significant drop in value over the past couple of years.”
These investments will be part of a new asset class, called real assets, with investments in real estate, infrastructure and commodities.
Real estate will make up 33-50% of the allocation to real estate.
Louisiana Teachers figures to make one or two commitments to opportunity funds in the range of $75m to $100m.
The pension fund is considering placing capital into two kinds of opportunity funds.
Some of the vehicles may be limited to investing only in the US, while others will have a global strategy that would invest in real estate in Europe and Asia, as well as the US.
Louisiana Teachers will be working with its manager, Hamilton Lane, on the commitments for opportunity funds.
The company has full investment discretion on the account with the pension fund, but proposed investments will still be presented to scheme’s board.
Louisiana Teachers has already established a core element to its real estate portfolio.
The pension fund has an investment in PRISA managed by Prudential Real Estate Investors valued at $130m and an investment in the JP Morgan Strategic Property fund valued at $140m.
Last month, the scheme invested $100m into infrastructure through Energy Partners II, managed by Energy Capital Partners.