Teachers’ Retirement System of the State of Kentucky has made a $100m (€85.9m) commitment to Angelo Gordon’s net lease value-add real estate fund.
The pension fund disclosed in a board meeting document that the capital committed to the AG Net Lease Realty V fund, comprised an $85m commitment from the Retirement Annuity Trust and $15m from the Health Insurance Trust.
The fund manager is targeting $1.5bn for the fund and has committed a co-investment of up to $15m.
Angelo Gordon, which is committing co-investment of up to $15m into Realty V, is seeking to raise $1.5bn for the fund.
Angelo Gordon is planning to focus on acquiring tenant-owned properties and structuring a long-term lease with appropriate landlord projections. This may provide downside protection to the investors in the fund.
The fund will primarily invest in North American assets, with the mandate allowing for up to 25% exposure to international markets.
Realty V aims to achieve a net return of 10% to 12%. Angelo Gordon expects a 7% annualised distribution to limited partners on a quarterly basis, with planned leverage between 55% and 60%.
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