Virginia Retirement System has added $500m (€359m) of new investments to its real assets portfolio, including commitments to two funds managed by Blackstone Real Estate Partners (BREP).
The pension fund has committed $150m to BREP Asia, an opportunistic fund that will make debt and equity investments in Asian markets, including Japan, Australia, China and India.
BREP is aiming to raise $3.5bn for the fund and is seeking to achieve gross returns of 20% for investors.
Virginia has also committed $200m to BREP Edens Investment Partners, which will provide exposure to core retail property on the East Coast of the US.
Capital for the Edens Investment Partners fund is being raised to cover BREP’s $968m investment in Edens Investment Trust made last December.
Edens, a privately held retail property investment company, is Blackstone’s first venture into core real estate. The commitment from Virginia follows a $200m investment from the State of Wisconsin Investment Board.
Virginia is also investing $150m in the First Reserve Energy Infrastructure Fund II, a closed-end fund vehicle targeting global energy infrastructure projects.
The pension fund said it had no targeted allocation for real estate and only invests in the asset class when it finds a compelling investment opportunity. Real estate is part of the real assets portfolio, now valued at $6.3bn. The asset class makes up 10.1% of the pension fund’s $62.3bn of total assets, as of the end of 2013.
Public School Teachers’ Pension and Retirement Fund of Chicago has approved an request for proposal (RFP) to invest up to $50m in a non-core industrial real estate fund. A commingled fund is the preferred structure.
The pension fund and its real estate consultant, The Townsend Group, will review candidates, with responses due by April 8. The entire search and the negotiation of the contract are due to be completed by June 30.
Chicago Teachers has several requirements for the search. Each manager must have a fully-documented track record and the proposed investment product must have a 90%-or-greater focus on industrial properties.
The pension fund had a real estate portfolio valued at $795m as of the end of October 2013. The asset class covers 7.8% of its $10.1bn total plan assets, with a targeted allocation for real estate of 8%.
