The Arizona State Retirement System (ASRS) has planned $2 billion of sales to meet its new 17 percent target allocation to real estate, which will take effect in fiscal year 2024.
The pension fund is planning dispositions of peak and/or underperforming assets, strategy exits and accretive portfolio recapitalizations with ASRS’ operating company (OpCos) partners to meet the amended target, which was reduced from 20 percent in fiscal year 2022. In addition, ASRS is planning about $1.2 billion of distributions from commingled funds in the first two years of the forecast period.
ASRS has secured a pipeline within its main investment pillars, which include multifamily, purpose-built single-family rental communities and logistics through its investments in the OpCos of these managers.
ASRS said RCLCO Fund Advisors conducts an annual hold/sell analysis to recommend disposition of assets that have reached peak value for the pension fund. The current portfolio is large