REAL ESTATE - The $10.8bn (€8.4bn) Ohio Police & Fire Pension Fund has approved investments totaling $200m into two core open-ended commingled funds.
Both the Strategic Property Fund and Pramerica Real Estate Separate Account (PRISA) were given a $100m allocation each.
The fund took this action at its board toward the end of July. It works on its real estate investments with its real estate consultant, The Townsend Group.
These two commitments will not be going into these funds right away. Many of the larger core open-ended commingled funds have a waiting list for pension funds for large commitments. Ohio Police & Fire’s capital for the Strategic Property Fund will have to wait less than six months for it to be placed into the fund.
The fund manager for PRISA is $8.5bn Pramerica Real Estate Investors commingled fund.
PRISA mostly looks for deals in the four main property types of office, industrial, retail and apartments. One of its big strategies for this year is to buy properties with staggered leases. This would mean buying properties with some rents at below market and being able to add value when some tenants come up for renewal.
JP Morgan Asset Management is the fund manager for the Strategic Property Fund. The commingled fund has a net asset value of $11.1bn.
The real estate manager had a very active second quarter for the commingled fund. It invested $536m of equity into the marketplace. This includes residential, office and industrial transactions.
The investments with JP Morgan and Pramerica are part of an investment strategy that the pension fund agreed to earlier this year. It’s selling around $225m of its separate account assets and reinvesting the proceeds into core open-ended commingled funds. This was started in June with $50m commitments to The Prime Property Fund and RREEF America REIT II.
Ohio Police & Fire still has a ways to go before it reaches its targeted real estate allocation. Its real estate portfolio has a current value of $530m.