Los Angeles Fire & Police Pensions (LAFPP) is looking to sell $150m (€140m) of its investments in real estate investment trusts (REITs) to bring its $1.6bn listed property exposure back in line with its target.
The pension fund disclosed in a board meeting document that, during the fourth quarter of last year, it issued two redemptions of $75m from portfolios managed by Cohen & Steers Capital Management and Principal Real Estate Investors.
The REIT investments accounted for 47.16% of the pension fund’s $3.49bn real estate portfolio, as of the end of 2022, above its target allocation of 30%.
So far this year, LAFPP has not issued new commitments to private real estate investments due in part to its over-allocation to public REITs. The pension fund approved $225m worth of private real estate commitments last year.
The Townsend Group, LAFPP’s consultant, said the rebalancing was expected to continue in the current year.
Cohen & Steers, which manages a $663m portfolio for LAFPP, has been the pension fund’s domestic REIT manager since May 2018.
LAFPP has a $517m domestic REIT portfolio managed by Principal, created in 2006. Principal also manages a $177m global REIT portfolio created for the pension fund in 2014.
Alliance also manages a $290m passive REIT portfolio, which was formed in 2015.
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