The Texas Permanent School Fund is to invest $225m in value-added, opportunistic and debt strategies in the US.

The institution has approved three $75m commitments to Ares US Real Estate Fund VIII, Carlyle Realty Partners VII and Invesco Mortgage Recovery Fund II.

The Ares fund is pursuing a value-added strategy in the US where it will improve assets through renovation, re-leasing and repositioning. It will focus on office, industrial, retail and apartment assets, but also expects to invest in hotels.

Ares Management has raised $490m from investors for the fund and is aiming to close in December with a total of $750m.

Carlyle Realty Partners VII is an opportunistic fund that will invest in North America, predominantly in the US.

It will target renovations and development projects by working with local operating partners.

The Carlyle Group, which manages the fund, mostly targets single-asset transactions between $10m to $30m rather than portfolio deals. It will target office, industrial, retail, apartment, for-sale residential, hotel and senior housing investments.

The Invesco Mortgage Recovery Fund II will invest in mortgage-backed securities and loans both in the commercial and residential sectors.

Invesco raised $1.46bn for its first mortgage recovery fund in 2010, having been pre-qualified as a fund manager for the US Treasury’s Legacy Securities Public-Private Investment Program.

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