School Employees Retirement System of Ohio (SERS) has approved a $40m (€36.7m) investment in the Blackstone Strategic Partners Real Estate VIII fund, as reported by the pension fund in a board meeting summary.
It is the first time that Ohio SERS has invested in the fund series and the pension fund’s commitment came in at the very end of the $2.6bn capital raise by Blackstone.
Target returns for the fund are expected to be several percentage points above the NPI benchmark, according to the pension fund.
The main investment focus for the fund will be to include limited partner (LP) liquidity solutions and general partner-focused solutions such as GP-led secondaries and co-investments.
Ohio SERS wrote in an email to IPE Real Assets that Blackstone is a leading institutional real estate investor with a successful fund series history and possesses the ability to capitalise on favourable real estate investment opportunities.
Ohio SERS has also made a structural change to its real assets portfolio, splitting real estate and infrastructure into two separate asset classes.
The move is designed to improve performance evaluation. The existing benchmark for real assets was the NCREIF Property Index, which only includes real estate and was no longer deemed an accurate method of measuring the performance of the real assets portfolio, of which infrastructure now represents 32%.
The NPI index will be retained for real estate, while the new benchmark for infrastructure will be CPI-plus 1.2% per quarter and smoothed over a one-year period.
The target allocations for real estate stand and infrastructure – 13% and 7%, respectively – will remain unchanged.
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