GLOBAL - The San Diego County Employees Retirement Association has approved a $200m (€152m) commitment into the JP Morgan Strategic Property fund.
The pension fund cited the core commingled fund's open-ended structure as a key reason for its decision.
San Diego County said it was unconcerned that its commitment to the Strategic Property fund were unlikely to be called down before the first or second quarters of 2011.
The backlog is a result of JP Morgan Asset Management possessing commitments totaling $1.4bn, while continuing to raise new capital and closing on limited acquisitions.
San Diego County, which is looking to achieve a return of NPI plus 100 basis points on its investment, has been looking to re-balance its real estate portfolio into more core assets, as it had fallen below its 50% core asset target prior to the JP Morgan commitment.
Its investment in the Strategic Property fund and the transfer of $70m from a global REIT strategy with RREEF to the manager's separate account with the pension fund will bring the core sector close to the 50% range on a net asset value and unfunded basis.
The fund terminated RREEF and CB Richard Ellis as its global REIT managers in June, reclaiming $136m of investments.
Around $80m of this capital was used to fund the investment in the Strategic Property fund.
The rest of the funding came from the real estate allocation.
San Diego County's strategic real estate plan involves three strategic partners in the asset class, but it has not outlined a timetable for when a third company will join RREEF and JP Morgan.
The pension fund last valued its real estate portfolio at $504m through the end of March.
The total plan assets for the pension fund were at $6.8bn as of the end of June.
With the commitment for the Strategic Property fund included, the pension fund has now invested 9.6% of its 10% targeted allocation for real estate.
