Contra Costa County Employees Retirement Association (CCCERA) plans to be an anchor investor in a new opportunistic real estate fund being marketed by DLJ Real Estate Capital Partners.
The pension fund intends to commit $50m (€42.8m) to DLJ RECP Fund VI which has a capital raising target of $350m, according to a board meeting report.
CCCERA has $166m of capital to invest in opportunistic real estate and it already holds a $23m investment in the previous fund.
The pension fund has invests through other opportunistic real estate fund managers, including Oaktree Capital Management, Angelo Gordon and Siguler Guff, but it said DLJ is the only manager on its roster actively raising capital for a true opportunistic fund.
DLJ will co-invest 2-4% of total commitments to the fund.
The fund will target offices and condominiums in emerging neighbourhoods in New York City, Boston and Los Angeles.
It can invest in existing assets and developments and use leverage up to 65% loan-to-cost.
CCCERA said the fund manager is projecting an 18% gross internal rate of return (IRR) for the fund. The previous fund is currently generating a 26% gross IRR.