One of Switzerland’s biggest pension funds is seeking managers to run CHF600m (€535m) in unlisted real estate assets, according to a new search on IPE Quest.
Publica, which runs CHF39bn in pension assets for Swiss public sector workers, last year expanded its strategic allocation to global private real estate to 6%. It wants to improve its overall investment portfolio’s risk-return profile “by harvesting illiquidity and complexity premiums”.
IPE Quest search QN-2546 states that Publica wants to allocate CHF600m to the core or core-plus European real estate, with CHF100-300m “per fund investment”.
The investor is looking to allocate to pooled funds focused on the retail, office, residential and industrial sectors. Other sectors can be included but should be limited to 10% of the fund. Value-add or opportunistic assets are permitted but should be limited to 20% and 5% of the fund, respectively.
Managers of single-sector funds can pitch for the mandate if they are pan-European strategies, Publica said.
Providers applying for the mandate should have at least CHF5bn under management in core, core-plus and value-add global real estate strategies, and at least CHF20bn in firm-wide assets under management.
Publica also stated that managers must have a “proven track record” and “a strong standing in the real estate markets”. They must also have “a well-structured and comprehensive investment and risk management process and a clear strategy for the fund”.
Proposed products must be suitable for institutional investors and eligible for Swiss pension funds. Newly launched funds are acceptable, Publica said, but managers would have to offer a “significant” fee discount.
Performance should be stated net of fees to 31 March 2019. The deadline for submissions is 28 June at 5pm UK time.
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