New York State Common Retirement Fund (NYSCRF) is investing $600m (€533.7m), alongside an unnamed investor, for an 80% stake in an opportunistic US apartment fund managed by Fairfield Residential.
The pension fund is a cornerstone investor in the Fairfield Create Core Multifamily apartment development fund, which is expected to raise $750m, with backing from another institutional limited partner. Including debt, the fund is expected to invest in $1.5bn worth of assets.
NYSCRF told IPE Real Assets that through new development, the pension is “seeking to create a portfolio of apartment complexes that will be held through multiple economic cycles.
“Projects that break ground today will be delivering units for rent in 2022 or 2023, a timeframe that most economists believe will be a period of outsized economic growth and pent up demand.”
The targeted returns for the fund are 9% to 11% net internal rate of returns based on a 10-year holding period.
NYSCRF has also approved two $15m real estate investments for its real estate emerging manager program. The commitments were made to Davis Investment Ventures Fund IV, a value-add fund with a $650m fundraise target and to the Brasa Credit I debt fund.
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