REAL ESTATE - Penwood Real Estate Management has attracted $100m (€84m) in equity for its first commingled fund called California Select Industrial Partners.

The capital came from two public pension funds contributing $50m each: one of these was the New York State Teachers Retirement System.

Penwood principal John Hurley said: "We chose the southern California industrial market for our first fund because it has an attractive risk/reward balance and it is one of the most dynamic industrial markets in the country."

California Industrial Partners will mostly be investing in Los Angeles and Orange Counties and in the Inland Empire. There could be some deals in San Diego as well.

The investment strategy is a value-added one. Around 70% of the transactions will be investing equity in new development projects and 30% in buying existing assets that can be improved. All of the properties will be warehouse/distribution type of assets.

There are no assets in the fund at this time. But Penwood said it was working on its first deal. This is a new development project costing $25m. Around $10m of equity will be going into it with the balance being made up in loans.