Los Angeles City Employees’ Retirement System (LACERS) intends to rebalance its core holdings in open-ended real estate funds to help improve returns.

The pension fund said in a meeting document that it is planning to invest as much as $173m (€148m) into real estate during the fiscal 2019 year beginning in July. Most of the new capital will be invested through a non-core strategy, it said.

LACERS, which is being advised by The Townsend Group, will make the investments through funds which focus on US office, retail and niche property types.

LACERS will be evaluating its existing core open-ended fund portfolio during the second half of 2018, as it seeks to rebalance this sector of its real estate portfolio to maximize benefits and improve returns. 

The pension fund has made several commitments into core open-ended commingled funds since 2015. These have been into the Morgan Stanley Prime Property Fund, Principal US Property Account, Jamestown Premiere Property Fund and Clarion Lion Industrial Trust.

LACERS’ current real estate portfolio is valued at $947m or 5.7% of its total plan assets.