real estate assets | Pension360

Maryland Pension Fires REIT Manager, Will Transfer $311 Million Portfolio To New Firm

The Maryland State Retirement and Pension System is shaking up its domestic REIT portfolio as the fund has fired LaSalle Investment Management and will shift its $311 million domestic REIT portfolio to State Street Global Advisors.

From IPE Real Estate:

Maryland State declined to comment or provide a reason for the decision, while LaSalle failed to respond.

The $311m (€244m) domestic REIT portfolio will be transferred to State Street Global Advisors (SSgA), with a global investment strategy for REITs, benchmarked against the FTSE/EPRA NAREIT Developed Index.

Maryland State said it had a long relationship with SSgA across passive equities, core fixed income and EMD.

The pension fund also uses Morgan Stanley as a global REIT manager for a $387.6m foreign portfolio, also benchmarked against the FTSE/EPRA NAREIT Developed Index.

Maryland State has approved a $50m commitment to CBRE Strategic Partners US Value Fund VII.

CBRE Global Investors is raising $1.5bn for the US-focused fund, in which it will co-invest a maximum $30m.

The fund, which will invest in the office, industrial, hotel, retail and apartment sectors, has a targeted 15% gross IRR and a 12.8% net.

The pension fund has made nearly $280m in commitments to CBRE Investors since 2007.

The Maryland State Retirement and Pension System manages nearly $45 billion in assets and allocated 6.9 percent to real estate.

Canada Pension Invests Nearly $400 Million In Brazilian Real Estate

The Canada Pension Plan Investment Board (CPPIB), the entity that manages investments for the Canada Pension Plan, plans to invest $396 million in commercial real estate in Brazil.

From Reuters:

In a statement released late on Monday, CPPIB said the investments include the purchase of warehouses, land and stakes in development projects in the logistics and retailing industries, adding to the fund’s portfolio of more than 100 properties in Latin America’s largest economy.

The move brings CPPIB’s real estate commitments in Brazil to over $1.8 billion. Since 2009, CPPIB has bought real estate in Brazil to profit from rising demand for corporate and distribution facilities.

[…]

CPPIB will pay 507 million reais for 30 percent in a joint venture with Singapore’s Global Logistic Properties Ltd. , the world’s No. 2 owner of industrial properties, to run 32 logistics properties in São Paulo and Rio de Janeiro, the statement added.

Another 231 million reais were committed to GLP Brazil Development Partners I, a real estate investment vehicle in which Global Logistic Properties has a 40 percent stake and CPPIB a 39.6 percent stake.

CPPIB also pledged to spend 159 million reais to buy a 25 percent stake in a São Paulo logistics project alongside Cyrela Commercial Properties SA.

The fund also paid 100 million reais for a 33.3 percent stake in the Santana Parque Shopping mall, which is jointly run by partner Aliansce Shopping Centers SA, the statement added. CPPIB has a 27.6 percent in Aliansce, a shopping mall operator.

From a CPPIB statement released Monday:

“Since making our first real estate investment in Brazil in 2009, CPPIB has become one of the largest investors in the sector with ownership interests in logistics, retail, office and residential assets or developments,” said Peter Ballon, Managing Director & Head of Real Estate Investments – Americas. “Over the past 10 months, we deepened relationships with our key partners to commit additional equity in high-quality real estate assets that are important additions to our diversified Brazilian portfolio. Our team of real estate professionals based in our recently opened Sao Paulo office continues to pursue attractive investment opportunities in the region.”

The Canada Pension Plan Investment Board manages $226 billion in assets.

Florida Pension Invests $63 Million In European Real Estate

The Florida State Board of Administration, the entity that manages assets for the Florida Retirement Systems, announced a $63.76 million commitment to a JP Morgan fund that invests in real estate in France, the UK and Germany.

Reported by I&P Real Estate:

Florida State Board of Administration has approved a €50m (€39.1m) commitment to JP Morgan Asset Management’s opportunistic European IP Fund III fund.

The fund has also approved a $100m allocation to Prologis’ Targeted US Logistics fund.

As revealed by IP Real Estate last week, JP Morgan’s opportunistic fund is aimed at assets in the UK, Germany and France.

The fund manager can raise as much as €750m for the fund, which will invest in office, industrial, retail and residential properties, according to Florida SBA. Buildings with low vacancy and in need of refurbishment and redevelopment are being targeted by the fund.

As reported, the fund is currently investing in office properties in Berlin and Paris. With leverage, the fund could invest as much as €3bn across Europe.

Florida said it would continue to identify international pooled fund opportunities as part of its plan for the current fiscal year.

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Florida has also recently sold two office buildings for $202m. The Nyala Farms office asset in Westport, Connecticut was sold for Florida by L&B Realty, while One Boca Place was sold through Invesco Real Estate.

The pension fund has allocated $900m for new real estate investment opportunities, split into $500m for core and $400m for non-core. Capital will be invested via both funds and direct ownership through separate account managers.

Florida’s long-term real estate allocation target is 10 percent. It currently invests 7.5 percent of assets in real estate.

Orange County Pension Seeks Manager For $150 Million Real Estate Commitment

The Orange County Employees Retirement System (OCERS) is looking for a manager to handle a new, $150m non-core real estate investment. From I&P Real Estate:

Orange County Employees Retirement System is conducting a new manager search for $150m (€117.7m) of non-core investment.

[…]

Orange County and RVK will conduct due diligence on investing some capital in the AG Core Plus IV fund.

An investment recommendation is expected next month, along with a presentation to the pension fund’s investment committee.

Orange County made a $40m commitment to AG Core Plus III in 2011, and the fund has generated a gross IRR of 18.94% since inception.

The $22.7m of capital called and invested is currently valued at $29.5m, as of the end of June.

For Fund IV, Angelo Gordon & Co is targeting 14-15% gross returns, with most investments to be in the US, alongside selective transactions in Europe.

Orange County and RVK will also consider other diversified funds targeting a similar risk/return profile to that of AG Core Plus IV.

The manager needs to have at least $500m in combined US and international real estate assets under management.

Orange County does not want more than 20% ownership of the total fund.

Each manager must have at least five years of performance history managing commercial real estate.

Orange County is looking for a focus on core-plus and value-added assets, with the opportunity to increase value through leasing, redevelopment, repositioning and other activities.

Preferred property types include apartments, hotel, industrial, office, retail and self-storage assets.

The move is part of a plan by OCERS to significantly increase non-core real estate investments. Currently, non-core makes up 23.7 percent of the fund’s real estate assets.

OCERS is shooting to increase that number to 30 percent by the end of 2016.