Pennsylvania Public School Employees’ Retirement System (PSERS) has made $250m (€214m) of new commitments to real estate funds.
In a board meeting document, the pension fund said it will put $150m into Angelo Gordon’s AG Realty Value Fund X and $100m into LEM Capital’s LEM Multifamily Fund V.
Pennsylvania PSERS said there was a strong case for investing in US value-add assets over the next four years.
According to the pension fund, Angelo Gordon plans to acquire sub-performing properties and improve their cash flows and value, targeting returns of between 16-17%.
AG Realty Value Fund X is also able to co-invest up to 20% of its capital in value-add deals made by Angelo Gordon’s European and Asian funds. Angelo Gordon has recently raised capital for AG Asia Realty Fund IV and AG Europe Realty Fund II.
LEM Capital, which is seeking to raise $400m for its fifth multifamily fund, plans to buy rental apartments, student accommodation and senior housing in the US.
It will target assets worth $50m or less and net returns of 12-15%.