Prologis is planning to significantly increase the size of its open-ended US fund by moving assets from its balance sheet, according to one of its investors.
It was revealed during a board meeting of the Texas Permanent School Fund that Prologis intends to transfer $3bn (€2.64bn) worth of assets from its balance sheet, increasing the size of the $5.5bn Targeted US Logistics Fund by almost 50%.
Prologis did not comment.
Texas Permanent School Fund has approved a $100m to the fund.
During the board meeting last week, the pension fund’s real estate adviser Courtland Partners cited the transfer of assets as one of a number of reasons to invest in the fund.
The move will enable Texas Permanent to gain immediate exposure to a diversified logistics portfolio at an attractive price.
Around 85% of the portfolio is located in major markets in Southern California, Miami, New Jersey, Chicago and the San Francisco Bay Area. The balance includes assets in regional markets such as Austin, Denver, Columbus, Ohio and Eastern Pennsylvania.
Courtland Partners said the 5.5% capitalisation rate on the additional $3bn portfolio compares favourably with the yields on most US logistics portfolios, which are often below 5%.