REAL ESTATE – The San Joaquin County Employees Retirement Association has approved an investment plan for 2007 that will be placing $60m (€45.5m) to $100m into a mixture of either value-added or opportunistic commingled fund commitments.
The pension fund finalised this strategy at its board meeting, with input from the investor’s real estate consultant, ORG Real Property.
"ORG presented an investment plan to our board that they feel comfortable with and they will now go forward with," said Bob Palmer, administrator for San Joaquin County.
ORG principal Ed Schwartz, who works on the San Joaquin County account said: "This new capital will be able to give the pension fund another layer of diversification within its real estate portfolio. This will be with the kind of transactions, property types invested and from a geographical perspective."
The first step in the process will happen in April, when ORG brings a number of commingled funds before the board for review, when the actual investment decision will be made.
The amount to be invested into each commingled fund is projected to be in the range of $10 to $35m. The investment funds could be focused on a single property type or spread out covering several property types. The investment strategy could cover both the US or internationally.
San Joaquin County felt that it already had an established core portfolio. One part of this was investing in the RREEF America REIT II commingled fund. This fund buys established and leased office, industrial, retail and apartments.
San Joaquin County still has a little ways to go before it reaches its targeted real estate allocation of 7.3%. Its real estate portfolio has a current value of $160m. This means that 5.5% of its $2.1bn of total assets has been invested in real estate.
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