California State Teachers’ Retirement System (CalSTRS) has transferred $475m (€436m) of its investments in core real estate funds and committed a further $400m to an index fund.
The IDR Core Property Trust, managed by Investors Diversified Realty (IDR), is designed to provide exposure to most of the core open-ended funds that make up the $321bn NCREIF Open‐end Diversified Core Equity (ODCE) index.
IDR, now a subsidiary of USAA Real Estate, raised $1.5bn from US pension funds in 2019.
CalSTRS has transferred its holdings in three ODCE funds: PRISA, managed by PGIM Real Estate, the JP Morgan Strategy Property Fund and the UBS Trumbull Property Fund.
According to a report by the pension fund, the three funds have yielded estimated net initial rates of return of 10.6%, 10% and 7.8%, respectively.
The additional $400m commitment means CalSTRS has invested a total of $875m in the fund.
The pension fund also revealed it had approved a $500m commitment to the Longfellow SV Fund II, which will develop life-science real estate assets in the US.
It is the first time that CalSTRS has invested with the fund manager Longfellow Real Estate Partners, which declined to comment.
CalSTRS is also looking to boost its industrial real estate exposure through a $400m commitment to the CBRE US Logistics Partners and a $300m investment in CBRE Asia Value Partners Fund VI.
At the end of the third quarter of 2021, CalSTRS was under-allocated to logistics by eight percentage points, according to a report by RCLCO Fund Advisors.
A previous version of this story described the IDR Core Property Trust incorrectly. The IDR Core Property Trust is an index fund.
To read the latest edition of the latest IPE Real Assets magazine click here
No comments yet