Los Angeles Fire & Police Pensions (LAFPP) is proposing a new three-year contract extension with Principal Real Estate Investors for a domestic and global real estate investment trust (REIT) manager relationship.
According to a meeting document, LAFPP is planning to recommend that Principal should be rehired to manage the $660.4m (€661.4m) domestic REIT portfolio and the $198.3m global REIT portfolio.
The new contract begins in December.
The Principal-managed domestic portfolio accounts for 35% of LAFPP’s total REIT allocation. This portfolio was made up of 30 to 50 different REIT securities with companies that own real estate in the US.
The domestic REIT portfolio has a blended benchmark over three time periods. These are Wilshire Real Estate Sec Index from 2006 to 2020, Dow Jones US Select Real Estate Securities Index from 2010 to 2019 and the FTSE NAREIT All Equity REIT Index since 2020.
The Principal global REIT portfolio invests in a total of 85 to 95 different securities. Its benchmark is the FTSE EPRA/NAREIT Developed Index.
The portfolio has almost two-thirds exposure to REITs in North America. Other major regions include 12.08% in Pacific Ex-Japan, 9.33% Japan, 8.24% in Europe ex-UK and 5.07% in the UK.
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