US roundup: Ohio School Employees, Swift Realty Partners

The School Employees Retirement System of Ohio will more than double the size of its real estate investment trust (REIT) portfolio by hiring a third fund manager.

The pension fund has approved a new request for proposal (RFP) to manage a $150m (€109m) US-only REIT strategy.

Ohio School Employees has an existing REIT portfolio valued at approximately $140m, managed globally by Clarion Real Estate Securities and Invesco Real Estate and benchmarked against the FTSE/EPRA/NAREIT Developed Index.

The new strategy, which is long-only and passive, is intended to improve the risk-return characteristics of the overall portfolio.

Responses are due by April 7, with a final decision to be made by June. Any manager responding to the search must have a three-year history of investing in REITs as of the end of 2013 as well as at least $1bn of assets under management in US REITs.

Ohio School Employees has a real estate portfolio valued at $1.2bn, as of the end of 2013, making up 10.5% of the pension fund’s total plan assets. The target allocation for real estate is 12%.

Swift Realty Partners, a start-up fund management firm established in 2010, is seeking a final equity raise of $330m for its first commingled fund, Swift Realty Real Estate Partners Fund I. Investors in the fund include Teacher Retirement System of Texas and Credit Suisse.

Swift Realty Partners was founded by former Equity Office Properties president and CEO Christopher Peatross. 

The value-added fund is targeting high-teen returns, with leverage placed on the fund up to a maximum 65% and capitalisation approaching $1bn.

The fund will invest in value-add office and industrial properties in the US. Targeted markets are on the West Coast from Seattle to San Diego.