State of Wisconsin Investment Board (SWIB) has committed an additional $60m (€51.9m) to its US apartment complex investment relationship with Essex Property Trust.
The pension fund disclosed in a board meeting document that it committed the capital to WESCO VII, a new investment joint venture with Essex Property, an existing manager.
Publicly traded real estate investment trust Essex Property contributed $50m of new capital into the venture, in which both it and SWIB each maintain a 50% interest.
All of the venture’s capital will be deployed into structured finance investments for properties located in markets where Essex already has a presence, including Northern and Southern California and Seattle.
WESCO VII’s first transaction is a $42.6m preferred equity investment, which will develop a 480-unit South San Francisco apartment complex. The deal offers an initial preferred return of 13.5% and is expected to be fully funded in the current quarter.
SWIB declined a request to comment further on the matter.
The commitment to WESCO VII represents the only real estate commitment issued by SWIB during the third quarter of this year. SWIB is considering three potential commitments totaling $240m this quarter.
The pipeline includes two $100m deals that would establish new manager relationships, one in non-core residential, one in core retail, and a $40m non-core industrial co-investment with an existing partner.
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