Los Angeles Water and Power Employees Retirement Plan plans to invest up to $500m (€461.4m) in real estate in 2025, according to the pension fund’s board meeting document.
In 2024, the pension fund invested $300m in real estate, divided equally between core/core-plus and non-core investments. The 2024 amount includes a non-core commitment that was still pending as of last month.
StepStone, LA Water and Power’s real estate consultant, disclosed in the meeting document that the pension fund’s plan for 2025, includes making between $200m to $300m in core and core-plus real estate commitments to enhance its existing portfolio, with possible allocations to retail properties.
The pension fund’s real estate current portfolio has a 6.3% exposure to retail, compared to the NCREIF benchmark’s 13.2%. For non-core real estate commitments, the plan involves investing between $100m to $200m.
The strategy involves increasing exposure to property types and capital structures benefiting from current market conditions, such as distressed asset purchases and data centres driven by AI and storage demand; and making investments via structures like co-investments, secondaries and special situations.
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