New Mexico State Investment Council (SIC) is planning to invest $300m (€256.3m) in real estate in fiscal 2021, all of which will be allocated to non-core funds.
New Mexico SIC told IPE Real Assets that the Sovereign wealth fund already has “enough capital in our core sector and we believe more opportunities in the non-core space will be attractive” during the new fiscal year beginning 1 July.
Part of the investment plan involves the continued expansion of its portfolio in Europe where it believes value-add opportunities exist in sectors such as student housing, storage and multi-family, New Mexico SIC said in a meeting document.
Europe accounts for 9% of New Mexico SIC’s real estate portfolio. The long-term goal is to lift the Europe portfolio to between 10% to 15%.
The sovereign wealth fund said it has also approved a $75m commitment to the Brookfield Infrastructure Fund IV Renewable Power Sidecar, a fund seeking to raise $500m.
According to New Mexico, the fund targets a 10% net internal rate of return and 13% gross return.
“This fund allows us to invest in a renewable-energy only fund with a very strong manager and increases our diversification in our real return portfolio,” the sovereign wealth fund told IPE Real Assets.
The fiscal 2021 pacing plan for real return asset class investment, which will include some infrastructure, has been set at $275m.
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