Maryland State Retirement and Pension System (SRPS) has become the latest US pension fund to cut its exposure to real estate investment trusts (REITs).

Last year, IPE Real Assets reported that the $52.7bn (€47.1bn) pension fund was planning to review its REIT strategy and mandates, which represent $700m of its $4.1bn real estate portfolio.

The pension fund said in a board meeting document that it has decided to remove REITs from its real estate target allocation.

Its investment consultant Meketa Investment Group said the REIT allocation “significantly overlaps with the public equity portfolio”.

The consultant explained that REITs were a helpful tool when real estate allocations were growing, but Maryland SRPS is now “approaching the 10% long-term target allocation and can invest primarily in core and non-core real estate”.

The pension fund’s two REIT managers Morgan Stanley and State Street Global Advisers oversee portfolios valued at $539.6m and $246.2m, respectively.

Both investment managers were hired in May 2014 and had been benchmarked against the FTSE EPRA/NAREIT Developed Index.

It was not disclosed how the capital taken out of REITs would be re-invested.

The latest decision by Maryland SRPS follows similar moves by US pension funds this year to reduce exposure to REITs.

Massachusetts Pension Reserves Investment Management Board and State Universities Retirement System of Illinois have both made plans to reduce their REIT exposure in favour of private real estate.