New York State pension fund backs Niam and Brookfield real estate funds

New York State Common Retirement Fund (NYSCRF) is backing opportunistic real esate funds managed by Niam and Brookfield Asset Management.

The pension fund said it approved a €150m commitment to Niam Nordic VII and $400m (€347m) to Brookfield Strategic Real Estate Partners (BSREP) III.

The $207bn pension fund, which backed the previous Niam Nordic fund, told IPE Real Assets it “had evaluated several managers in the Nordics and Niam was identified as “the most experienced fund manager” in the region, having been active there for more than 17 years.

“Niam has been a first-quartile performer across all six prior funds, even during the GFC when other institutional fund managers retracted from the region,” it said.

NYSCRF said the “stable macroeconomic conditions in the Nordics provides the optimal environment for property market fundamentals and investing in real estate”.

It added that stable banking system, low levels of public and corporate debt, current account surpluses and strong GDP and population growth continues to drive investor interest in the region.

Niam Nordic VII is projecting a 13-15% net internal rate of return with a 1.7x net equity multiple, according to the pension fund.

In November last year, IPE Real Assets reported that Brookfield had raised more than $12bn for BSREP III and has a $14bn hard cap. 

NYSCRF said its investment in the fund “not only aligns with the objective to focus capital with proven managers and proven strategies, but also it is a viable opportunistic investment with an attractive return profile”.

The fund is targeting a gross return of 20% (net 16%), it said.

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