New Mexico State Investment Council (SIC) has approved a €200m commitment to Ares Management Corporation’s latest value-add European property fund.
The sovereign wealth fund is placing the capital into the Ares European Property Enhancement Partners Fund IV, a fund seeking to invest in a mixture of value-add income-producing industrial and residential properties.
New Mexico SIC previously committed €75m to a fund in the Ares European property fund series. In total, the sovereign wealth fund has invested $500m (€461.3m) in other Ares funds.
Partners Fund IV, a $2bn fund, plans to build a portfolio of 15-20 assets and targets net returns of 10% to 12%.
The Ares fund plans to invest capital expenditures to increase property value through improvements, new leases, and tenant space adjustments.
New Mexico SIC said it has also approved a $150m commitment to the Torchlight Debt Fund VIII, a US-focused real estate debt fund managed by Torchlight Investors.
The Torchlight fund, which seeks to raise $2bn, is expected to have final close at the end of March.
Torchlight disclosed in New Mexico SIC’s board meeting presentation that the fund had so far completed $777.9m worth of investments.
The Torchlight debt fund’s recent deal involved a Texas multifamily portfolio transaction. The transaction which closed in January involved a $157.7m senior loan for four properties.
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