The Public Employees Retirement Association of New Mexico is making plans to invest up to $80m (€58.2m) in real estate in 2014.
All this capital will be invested in its private real estate portfolio.
Joaquin Lujan, portfolio manager for private equity and real estate assets, said: “We are looking at investing this capital all through commingled funds.
“The investment focus will be with funds that have a value-added focus.
“This is where much of the strong investment opportunities will be located.”
New Mexico PERA will be looking to invest some capital on an international basis.
The focus for this strategy will be in Europe.
“We have had some good success with our previous exposure to that part of the world and hope to continue that,” said Lujan.
Examples of previous European commitments include managers such as DRC Capital and Starwood Capital Group.
The pension fund figures that the $80m of capital will be split into two $40m commitments during the calendar year.
The commitments could be with existing managers or firms with which it does not have a previous relationship.
“We would consider re-ups with some of our existing managers if it makes sense,” said Lujan.
Its two most recent real estate commitments were $50m to Wheelock Street Real Estate Fund II last December and $40m to DRC European Real Estate Debt Fund II in June 2013.
New Mexico PERA has an existing targeted allocation for private real estate of 3%.
It is at this allocation now, with an existing real estate portfolio valued at $443m and a total investment portfolio at $14bn.
The net IRR on the private real estate portfolio is 8.4%.
No comments yet