Pennsylvania Public School Employees’ Retirement System (PSERS) is investing $700m (€608m) in real estate strategies.

The $55.9bn pension fund said in a meeting document that it has approved $400m into TCI Real Estate Partners III and $300m into Brookfield Strategic Real Estate Partners III.

IPE Real Assets previously reported that fundraising for Brookfield Asset Management’s $10bn global opportunity fund was nearing an end.

Pennsylvania PSERS said Brookfield is targeting a hard cap of $15bn.

The fund is expected to deliver a gross internal rate of return of up to 20% by investing in real estate assets, companies, distressed debt and securities. It will use up to 70% debt financing.

As previously reported, UK-based TCI Fund Management, which is seeking to raise $3bn for Fund III, had a first close in March this year with commitments of $2.1bn. A second close is planned for this month.

The fund aims to build a portfolio of loans in trophy assets in prime locations in core markets.