Los Angeles County Employees Retirement Association (LACERA) is planning to change the profile of its $4.7bn (€4bn) real estate portfolio in the coming years by reducing its weighting to core assets and increasing its investments in higher-return funds.

The move is in part to increase diversification and to reduce being over-exposed to individual core assets, according to a board meeting document.

Over the next five to seven years the portfolio’s core allocation will be reduced from about 80% to 60%, while the value-add and high-return allocations will each be increased to 20% – from 7% and 13%, respectively.

LACERA, which has already been reducing its weighting to separate accounts in favour of funds, intends to increase commitments to real estate funds targeting apartment and industrial assets in the US and internationally.

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