Los Angeles Fire and Police Pensions (LAFPP) has redeemed $86m (€80.6m) from three of its real estate investment trust (REIT) managers due to overexposure to REITs within the overall real estate portfolio.
According to a board meeting document prepared by the pension fund’s real estate investment consultant, The Townsend Group, LAFPP has redeemed $60m from Cohen & Steers Capital Management, $14m from Principal Real Estate Investors and $12m from Alliance.
As previously reported, LAFPP is looking to sell some of its investments in REITs to bring its listed property exposure back in line with its target.
LAFPP’s REIT portfolio accounts for 44.2% or $1.4bn of its $3.1bn real estate portfolio compared with a 30% target allocation for the REIT portfolio which comprises domestic and global strategies.
Cohen & Steers was the strongest performer and largest contributor to the REIT portfolio in the last reported quarter, generating a gross return of 3%.
LAFPP plans to renew its real estate investment consultant contract with Townsend for three years, according to a board meeting document.
Townsend has added 41 new institutional clients and lost 22 over the past three years, according to the pension fund. The lost accounts were due to a number of reasons, such as budgetary constraints, differences in investment philosophy, mergers and acquisitions activity, and conversions of existing mandates to different strategies.
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