Investors - APRIL 4, 2013

Arkansas Teachers invests $20 million in real estate fund

by Sara Kassabian

The $12.6 billion Arkansas Teachers Retirement System (ATRS) has invested $20 million in the LaSalle Income and Growth Fund VI, a value-added fund managed by LaSalle Investment Management, says George Hopkins, executive director of the ATRS.

Approximately $1.1 billion of ATRS’ portfolio is currently invested in real estate. The pension fund invests in real estate funds but also directly into properties. ATRS is near its target real estate allocation of 10 percent. During 2013, the retirement system plans to invest $80 million in real estate. Following this latest investment, the pension fund has about $60 million remaining to invest in the asset class.

The LaSalle Income and Growth Fund VI launched in 2011 with a fundraising target of between $600 million and $700 million in equity. A final close date was not disclosed. The closed-end fund has a “build-to-core” investment strategy. It focuses on capitalizing on the current and growing demand for core real estate by investing in noncore properties, including office, industrial and retail properties that can be redeveloped and repositioned and then sold to core buyers.

Previous fund investors include the Illinois Municipal Retirement Fund, which committed $20 million; the Arkansas Public Employees’ Retirement System, which committed $30 million; and the Contra Costa County (Calif.) Employees’ Retirement Association, which committed $75 million.

The fund is part of a North America–focused closed-end value-added fund series that began in 1996. LaSalle Income and Growth Fund V, the fund’s predecessor, closed in 2008 with $729 million in equity commitments.


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