Massachusetts Pension Reserves Investment Management Board (Mass PRIM) has ended a real estate separate account managed by JP Morgan Asset Management, according to sources.
IPE Real Assets understands that Invesco Real Estate, which already looks after a $1.1bn (€969m) separate account behalf of Mass PRIM, will assume the management of most of the assets.
One remaining asset, a three-building office at 125 High Street in Boston, owned in a partnership with Tishman Speyer, will now be managed internally by Mass PRIM.
According to sources, the decision by $71.7bn pension fund is part of a reorganisation of its core real estate portfolio and follows the awarding of $1bn worth of separate account mandates to CBRE Global Investors, Stockbridge Core and Value Advisors, and DivcoWest.
Mass PRIM stated in a board meeting document that JP Morgan had managed a core separate account portfolio, currently worth $613m, for the pension fund since September of 2000.
The pension fund also stated that the portfolio had undeperformed its benchmark, the NCREIF Property Index, for every time period.
The separate account’s one-year return was 6.3%, missing the benchmark by 90bps; the three-year return of 4.8% underperformed by 350bps; the five-year return of 7% underperformed by 280bps; and the 10-year return of 5% underperformed by 120bps.
Mass PRIM declined a request for comment, and JP Morgan did not respond to a request for comment.