Massachusetts Pension Reserves Investment Management Board (Mass PRIM) has approved a $100m (€94.3m) commitment to BentallGreenOak US Value-Add Lending Fund, a fund planning to raise $500m.

Mass PRIM said the commitment to the BentallGreenOak fund will help the pension fund increase its exposure to real estate credit, which is currently underweight.

The pension fund also said it made the commitment as it believes the risk-adjusted returns of private commercial real estate debt compare favourably with other fixed-income strategies.

The US Value-Add Lending Fund is expected to provide debt for transactions real estate assets including multifamily, industrial, office, retail, hotels, and other niche sectors that require value-enhancing strategies like renovation, repositioning, lease-up or ground-up construction.

The fund is BentallGreenOak’s first US-only debt fund. The manager already has a $17bn global debt strategy.

BentallGreenOak did not respond to a request for comment.

Mass PRIM also disclosed in a meeting document that it approved a $150m commitment to KKR Opportunistic Real Estate Credit (ROX) II, a fund seeking to raise $1bn to invest in the US as well as some potential transactions in Europe.

ROX II expects to originate and acquire transitional senior loans and to invest in mezzanine loans, preferred equity and other debt-oriented investments with similar characteristics.

KKR declined a request for comment.

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