UNITED STATES - Sacramento County Employees Retirement System has extended the investment period for its AEW Value Investors II holding.
The original three-year investment worth $25m was due to end in March 2010 but officials decided at their recent board meeting to keep the investment until at least March 2011, said Jeff States, investment officer for Sacramento County.
"It's our opinion that this makes a lot of sense for our investment in the fund. This will allow the manager some more time to find deals as they have had a difficult time finding deals in the marketplace, and it means that the manager can search for good investment opportunities as they come available beyond the original deadline for the second half of 2010."
By the end of March this year, AEW had called on just $9.6m of the commitment and in the same time period, the pension fund has valued its investment in the commingled fund at $5.7m.
Sacramento County officials say they are under the impression that around 53% of the equity in the fund had been committed to transactions.
AEW had a total equity raise for Value Investors II of $650m but the real estate manager is discussing the possibility of extending the investment period with investors.
A further two investments were approved to the Hines US Office Value-Added Fund II and Allegis Value Trust when the pension fund made the commitment to Value Fund II but only Hines has so far suggested its investment period be extended.
At the same time as analysing existing investments, Sacramento County had also been in discussions with its consultant, Mercer Investment Consulting, about placing an additional $75m into other value-added commingled funds.
That decision has now been put on hold until there is a wider universe of liquid managers to choose from.
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