South Dakota Investment Council has approved a $300m (€254m) commitment to the Blackstone Real Estate Partners Asia II fund.
A number of institutional investors, overseen by the investment council, are providing the capital, according to a board meeting document.
The South Dakota Retirement System is committing $270m, the Education Enhancement Trust $13m, the Dakota Cement Trust and School & Public Lands $7m, and the Healthcare Trust $3m.
Matthew Clark, state investment officer for South Dakota, said: “We are a big believer in Blackstone’s real estate operation in Asia. They have established a very strong investment team for its real estate tractions it’s looking for in Asia.
“We wanted to invest capital in their first Asia fund, but we didn’t have any room in our portfolio when they were raising capital for its first Asia fund. This time around we did have capital available to invest in the fund.”
The South Dakota Retirement System had a real estate portfolio valued at $1.1bn, representing 9.3% of its total assets, at the end of June. Its target allocation for real estate is 10%.
“We have invested in some other commingled funds with managers like Lone Star and Starwood that have made some investment in Asia, but not with a fund that only invested in Asia,” said Clark.
Blackstone has attracted commitments in excess of $5bn for Asia II, according to its third-quarter 2017 earnings report.
The is targeting gross returns of 20% by investing in China, Japan, India and Australia. It will focus on retail and industrial assets.
