Orange County Employees Retirement System (OCERS) has ended its $46m (€41.5m) real estate investment trust (REIT) separate account relationship with Waterfront Capital Partners due to poor investment performance.
The relationship began in 2020 with a $50m investment, but the portfolio’s value had decreased to $46m at the time of the decision, according to the pension fund’s board meeting document.
The Waterfront REIT separate account generated annualised returns of -2.94% over one year, -2.12% over two years and -2.88% since its inception.
OCERS said the separate account’s portfolio was negatively affected by factors such as rising interest rates, increased volatility in REITs, inflation and a discrepancy between the underlying fundamentals of REITs and their market prices.
The Waterfront REIT separate account was part of the pension fund’s unique strategies allocation.
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