NORTH AMERICA – The Massachusetts Pension Reserves Investment Management (Mass PRIM) board is looking to add up to $559m (€406m) to its real estate portfolio in the coming months.
The pension fund will make the investments in a combination of core and non-core properties through its separate-account real estate managers and potentially a new commitment to a close-end commingled fund.
Mass PRIM's most recent deal was the partial interest it bought for $90m in 333 Bush Street in downtown San Francisco.
The pension fund closed on two transactions during the month of August worth $171m of new equity capital through its separate-account managers.
One of these was a suburban office building purchased in its home state. The manager on this deal was TA Associates Realty.
The pension fund also bought an apartment complex in Atlanta, where Invesco Real Estate served as manager.
Mass PRIM has another group of transactions in its core pipeline that would involve a total of $298m of equity.
However, there is no guarantee that all of these transactions will be closed on by the pension fund.
The pension fund is looking to add more industrial assets to its real estate portfolio.
Tim Schlitzer, senior investment officer for real estate and timber at Mass PRIM, said: "We are under-allocated to industrial assets for our portfolio. As the economy improves, the performance of industrial assets will get better as well."
Mass PRIM is midway through due diligence on a new commitment for the next commingled fund being raised by one of its existing non-core managers.
"We will be talking about this at our 13 November committee meeting and likely taking it to our board for our meeting in early December,” said Schlitzer.
He would not comment on who the manager was or the size of the potential commitment.
Mass PRIM has a real estate portfolio valued at $4.4bn, as of the end of June.
Real estate makes up 8.2% of the $53.1bn in total plan assets.
The targeted allocation for the asset class is 10%.