Texas ERS puts $151m into real estate debt strategies

Employees Retirement System of Texas (Texas ERS) has set aside $151m (€123m) to invest in real estate debt funds.

The pension fund said it has approved a $101m commitment to BPEA Real Estate Fund II, managed by Hong Kong-based Baring Private Equity Asia, and $50m to Torchlight Debt Opportunity Fund VI, managed by Torchlight Investors.

As previously reported, BPEA Real Estate Fund II is expected to raise $750m, according to sources that tracking fundraising.

The non-core fund is designed to make debt investments in value-add and opportunistic real estate in markets including China, Hong Kong, Japan and Australia.

Torchlight Fund VI invests in US real estate debt and is targeting net returns of 13-15%.

Last August, IPE Real Assets reported that Illinois Municipal Retirement Fund was considering an investment in the fund.

San Diego City Employees’ Retirement System has also made a $20m commitment to Torchlight Fund VI, according to the pension fund’s board meeting report.

Torchlight Fund VI is expected to invest in senior and mezzanine loans, commercial mortgage-backed securities and other real estate related investments.

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