REAL ESTATE - The Teacher Retirement System of Texas will be looking at three commingled funds for possible investment decisions at its board meeting on November 9 and 10.
The three commingled funds to be considered are MacFarlane Urban Real Estate Fund II, Carlyle Realty Partners V and Citigroup Europe.
The size of the commitments to each fund will vary from $75m to $150m. This is the range that Texas Teachers looks to make for all of its commingled fund investments.
The pension fund will work with its real estate consultant, The Townsend Group, on these commitments. The person working on the account for the consultant is Principal Rob Kochis. He said, "All of these funds have their own unique strategies. The MacFarlane fund gives the pension fund a chance to invest with one of the stronger urban real estate managers in the country."
MacFarlane Partners will be investing in a variety of urban real estate across the country. This will include retail, residential and mixed-use projects. Returns for the fund are projected to be in the range of 16% to 18% for a leveraged IRR.
MacFarlane Partners is still out in the marketplace raising capital for Fund II. It has attracted interest from some of the largest pension funds in the country. This has included California Public Employees Retirement System, New Jersey State Investment Council and Illinois State Board of Investment.
Carlyle Realty Partners V is a $1.5 to $2.5bn commingled fund being sponsored by The Carlyle Group. This is an opportunity fund looking at investing in a variety of property types. This includes office, industrial, retail, senior living, for-sale residential and apartments. The vast majority of the transactions for the fund will be with real estate in the United States and Canada.
The Carlyle Group has received commitments from some other pension funds. These include Pennsylvania Public School Employees’ Retirement System and School Employees Retirement System of Ohio. Investors in the fund are projected to achieve a 18% to 20% gross IRR.
Citigroup Europe is an opportunity fund. It will look at investing in many different property types in Europe.