The Pennsylvania Public School Employees’ Retirement System is to invest $200m (€161.2m) in senior housing and growth capital for real estate companies.

The fund has made $100m commitments to Prudential Real Estate Investors’ Senior Housing Partnership Fund V and Almanac Realty Investors’ Securities VII fund.

Laurann Stepp, senior portfolio manager at Pennsylvania, said the fund was attracted to senior housing in the US, where she said there are 19m 75+ seniors – an age group expected to grow in the next decade.

Stepp said Pennsylvania was also motivated by the fact senior housing construction had stalled since 2007 as a consequence of a lack of financing during the financial crisis.

PREI is targeting a $500m raise for Fund V, which will focus on US for-rent, for-profit, private-pay independent living, assisted living and memory care assets, with up to 20% to be invested in Canada.

The fund will invest mainly in income-producing assets with minimum 50% occupancy.

Some investments may be structured as forward equity commitments on newly constructed properties.

Almanac, which is looking to raise $1bn for Securities VII, has so far received $765m in commitments, according to sources.

The fund, which will provide growth capital for either US real estate operating companies or public REITs, will structure its investments as either convertible debt or preferred equity.

Targeted returns for Securities VII are 12-14% net IRR, with no leverage.