New Mexico State Investment Council (SIC) has set aside $983m (€901.2m) to invest in real estate fiscal 2024 to mainly target non-core investments.
New Mexico SIC disclosed in a meeting document that the real estate pacing plan for the fiscal year that started on 1 July is needed to help the sovereign wealth fund (SWF) reach its long-term target net asset value allocation of 12% for its real estate portfolio.
As of the end of 2022, the overall real estate portfolio comprised 69% core assets compared with a long-term plan to have it a 55%.
In the just-ended fiscal 2023 year, New Mexico SIC had a $525m real estate pacing plan.
As part of the strategy for fiscal 2024, New Mexico SIC expects to continue being overweight to industrial and issue more commitments to multifamily. The SWF also expects to maintain its underweight to retail and office real estate.
The plan also involves an expansion of the sovereign wealth fund’s exposure to real estate in Europe. The plan has a long-term target range of 10% to 20% in Europe, which now accounts for 9% of the overall real estate portfolio.
New Mexico, which has no exposure to real estate investment trusts (REITs), is considering a REIT investment strategy. The aim would be to hire an outside manager to run a REIT portfolio if a decision is made to pursue the strategy.
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