NORTH AMERICA – The Pennsylvania Public School Employees’ Retirement System has added $275m (€200.2m) to its real estate portfolio in three commitments.
One of these commitments involves investing capital in Europe.
Pennsylvania has made a $100m allocation to the Blackstone Real Estate Partners Europe IV commingled fund.
The Blackstone Group is looking at a total equity raise of €5bn, which would make it the largest European dedicated opportunity fund, according to a document from the pension fund’s real estate consultant, Courtland Partners.
Europe IV will be focused on investing capital in the UK and Central Europe.
Courtland sees five major investment themes the commingled fund expects to pursue.
These are to purchase debt to gain control of assets, equity investments in restructuring/recapitalisation, dispositions by motivated sellers, bankruptcy situations and public-to-private transactions.
The pension fund made up to a $200m commitment into Blackstone Real Estate Partners Europe III in 2008.
Pennsylvania also made a $100m commitment to the DRA Growth and Income Fund VIII.
DRA Advisors is seeking to raise $1bn-1.35bn of equity for the fund, which will invest in the four major property types of office, industrial, retail and apartments in the US.
The assets it buys are properties where it can improve operations and that have the potential for capital appreciation.
Pennsylvania also approved a $75m commitment into the Exeter Value Fund III, an industrial-only commingled fund, where Exeter Property Group is seeking a $675m capital raise.
In the US, the fund is targeting New York/Philadelphia, Chicago, Dallas, Atlanta and Los Angeles.
The fund will also invest in Vancouver, Toronto and Calgary.
In other news, the Indiana Public Retirement System has approved a $100m commitment to the Mesa West Core Lending Fund.
This commingled fund has a real estate debt investment strategy in the US.
Investors are projected to achieve a net IRR in the range of 7% to 8%.
The fund will be making first mortgage loans on the four major property types and hotels.