UNITED STATES - Massachusetts Pension Reserves Investment Management Board has decided to expand its REIT investment program by increasing its allocation by 50%.
The pension fund made the decision, following an asset allocation review by Mass PRIM's own board and its consultant Cliffwater, LLC, at its February 5th board meeting to increase its Reit program allocation from 2% to 3%
The amount of new capital to be invested in REITs is $540m (€371.4m and this allocation will be split with 70% invested in the US and 30% invested on a global basis.
No new managers will be hired to invest the capital which is instead being funneled through its existing REIT managers.
Mass PRIM had a domestic REIT portfolio valued at $948m to October 31, 2007, managed by Wellington, RREEF, Urdang and Invesco.
The pension fund added a global strategy to its REIT program in December of last year for which European Investors and RREEF were each hired to manage a $200m allocation.
At the same February board meeting, Mass PRIM also created a new asset class called ‘natural resources' which will include renewable and non-renewable natural resources.
The pension fund claims it has had tremendous success with its timberland investment program and now wants to continue this success by investing in other natural resources, of which farmland is a possibility.
Initial allocation to this new asset class is $900m and appropriate managers are expected to be sought through a Request for Proposal manager search sometime in March.
Mass PRIM now has total plan assets of $53.7bn and around 10% of the assets are invested in real estate and REITs.