Connecticut Retirement to up value-add exposure with Crow Holdings fund
State of Connecticut Retirement Plans and Trust Funds (CRPTF) intends to invest $75m (€64.7m) in Crow Holdings Realty Partners’ eighth fund.
The investment will help increase its exposure to value-added real estate. It currently has 20.1% of its real estate porfolio in value-added investments, below its 25% target, according to a board meeting document.
Crow Holdings Capital Partners has raised $723m for its Realty Partners VIII fund, and is aiming for $1.5bn, limiting fundraising at $2bn. A final close on the fund is expected in the first quarter of 2018.
The fund, which invests in non-traditional property types, such as hotels, medical offices and convenience stores, has already committed to six investments across the retail, industrial and multifamily sectors.
It is projecting an annualised rate of return of 5% to 7% on an unleveraged basis, and an enhanced real rate of return of 8% to 10% on a leveraged basis.
The Crow Family Holdings will make a minimum commitment of $100m to the fund.
CRPTF invested in the previous fund, Realty Partners VII. The 2014 fund has generated a net internal rate of return of 8.7% for the pension fund.