South Dakota Investment Council has committed $150m (€129.7m) to a distressed global real estate fund managed by Starwood Capital.
The investor disclosed in board meeting documents that the capital was placed into the Starwood Distressed Opportunity Fund XIII Global.
The commitment was split across five entities overseen by the council, including the South Dakota Retirement System, The School and Public Lands Fund, The Dakota Cement Trust, The Education Enhancement Trust and The Health Care Trust.
Starwood Capital is looking to raise $10bn for the vehicle and plans to reach a final close later this year, according to sources familiar with the matter.
Fund XIII will primarily target transactions across North America and Europe, with selective opportunities in Asia. The fund is seeking net internal rate of returns of 14% to 16% with 60% leverage, focusing on a mix of residential, data centres, hotels, life sciences and traditional office assets.
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