The San Diego City Employees’ Retirement System could change its separate account with Deutsche Asset & Wealth Management.

The pension fund is to discuss the move at its 7 January investment committee meeting.

San Diego could redirect $47.5m (€44.2m) of equity left for Deutsche AWM to invest in another large real estate core fund, according to a board meeting document by the pension fund’s consultant, Aon Hewitt.

Aon Hewitt believes this would further diversify San Diego City’s core exposure and help lower long-term asset-class volatility.

The consultant sees less up and down performance in a large, core, open-ended fund than buying smaller properties on a separate-account basis.

Another change for the separate account on a long-term basis is to reduce the account from making up 52% of the pension fund’s real estate portfolio to 35%.

Assets considered to be non-strategic would be sold.

According to a board meeting document, the separate account is overweight industrial property and lacks office assets.

The separate account has a net asset value of $358.2m, as of the end of 2015, with 20 properties in the relationship.

In the first quarter of this year, JP Morgan Asset Management is expected to draw an additional $30m commitment made by San Diego to the JP Morgan Strategic Property Fund.

This will give the pension fund more than $100m exposure to the fund and mitigate the separate account with Deutsche AWM’s smaller investment exposure.