Massachusetts Pension Reserves Investment Management Board (Mass PRIM) has approved allocations totaling $300m (€283.7m) to two domestic REIT managers, according to a board meeting document.

DSW Group and PGIM won the mandates, following a US-focused manager search that started earlier this year, and were each awarded initial allocations of $150m.

The two managers will invest for the pension fund on a separate account basis. They will both be utilising the MSCI REIT Index as the benchmark for performance evaluation.

Mass PRIM said in the document seen by IPE Real Assets that its broader real estate portfolio will benefit from adding more REITs to the portfolio by increasing exposure to alternative sectors, which it believes are “not as easily investable” in the US private real estate market.

DWS’s US REIT portfolio is currently worth $882m, according to Mass PRIM. Its core strategy targets companies that trade at the greatest discount to the team’s intrinsic value, which is based on the value of each security’s underlying portfolio.

PGIM oversees a US-only mandate with assets under management worth $787.2m. Its public real estate securities team takes a valuation-oriented investment approach based on underlying real estate value and proprietary adjustments including management’s ability to create shareholder value and external growth opportunities.

Mass PRIM, including the new commitments to REITs, now has a REIT exposure of 11% of its total real estate portfolio. This is consistent with its approved objective in 2019 of reducing REIT exposure, which at the time was approximately 25% of total real estate.

Both DSW and PGIM declined to comment.

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