REAL ESTATE - Ohio Police & Fire Pension Fund has selected Robert A. Stanger & Co. as its real estate independent fiduciary to look at a portion of the pension fund’s real estate portfolio.

Ohio Police & Fire made this decision at a board meeting on March 26. The pension fund had conducted an RFP search for this assignment. Stanger & Co. made a presentation at the board meeting. This was conducted by George Wilson and Kevin Gannon. The other two finalists for the RFP were Real Estate Fiduciary Services and Duff & Phelps.

The pension fund was helped in the final decision by input from its real estate consultant, The Townsend Group. Frank Blaschka, a principal with Townsend, works on the Ohio Police & Fire account.

Stanger & Co. will now be responsible for looking at and analyzing all of the separate account assets that Ohio Police & Fire has with real estate manager INVESCO Real Estate. The work on the portfolio in question should be finished over the next couple of months.

There are a total of seven properties in the separate account with INVESCO. The most updated valuation of the assets had pegged them at $235m (€176.3m). The properties are spread out across the country and are a mixture of office, industrial, retail and apartments.

Ohio Police & Fire is planning on trading the properties from the separate account into a commingled fund that is managed by INVESCO. The name of the fund is the Core Real Estate Fund. Gross assets in the commingled fund are now in excess of $1.5bn.

The pension fund and Townsend both think that it’s very difficult to find properties to buy today for separate account managers. There is way too much capital in the marketplace versus the number of properties that are up for sale. It makes more sense to invest capital into commingled funds.

Investing in a core open-ended commingled fund will give the pension fund more diversification than with just seven properties. The Core Real Estate Fund is an open-ended fund. It owns established and leased office, industrial, retail and apartments around the United States.

Ohio Police & Fire going forward wants to invest in commingled funds and have less of its capital in separate accounts. The pension fund now has now actually invested $596m in real estate. This means it has around 5% of its $12bn of total assets in real estate. There are several other commitments to commingled funds that have not been funded yet. The targeted allocation for real estate is 8%.