Tricon Capital Group and Arizona State Retirement System (ASRS) have formed a $450m (€408m) joint venture to invest in US real estate.

US pension fund ASRS will commit $400m to the joint venture with Tricon adding the remaining $50m.

Tricon said it will fund its co-investment largely with internally generated cash flow.

The North American residential asset manager said the new partnership will target investments in ”master-planned communities and the development of single-family BTR communities in US Sun Belt markets”.

Tricon said it has a pipeline of potential investments including two master-planned communities, which it intends to offer as potential seed assets to this venture.

Gary Berman, CEO and president of Tricon, said: “We are thrilled to partner with ASRS in this joint venture, which represents a major commitment of capital towards our growth strategy.

“Through our partnership with ASRS, we aim to grow the master-planned communities business of our Johnson Companies subsidiary and to fund the development of single-family build-to-rent communities, a burgeoning asset class which leverages Tricon’s expertise across residential real estate product types.”

Berman said the joint venture provides increased scale and operational synergies for Tricon’s diversified housing platform.

A previous version of this story misstated that the JV will only invest in US single-family build-to-rent properties.