Investors - MARCH 29, 2018

CalSTRS closes roughly $4.4b of real estate commitments in H2 2017

by Jody Barhanovich

In the second half of 2017, the $224.4 billion California State Teachers’ Retirement System closed roughly $4.4 billion of commitments to new and existing real estate partners, according to the pension fund’s Investment Committee Semi-Annual Activity Report.

The majority of the commitments ($2.8 billion) were in high-control and liquid strategies such as joint ventures and open-end funds. Roughly $925 million was in closed-end commingled fund structures. Another $650 million was put into low-volatility debt strategies that provide high current cash flows and compelling total returns.

The majority of the commitments to real estate funds include the following:

Fund name Fund manager Amount committed (m) Strategy
CP Logistics UK (Separate Account) Principal Real Estate Investors $704 Core
Blackstone Property Partners Europe Blackstone $400 Value-add
Beacon Capital Strategic Partners VIII Beacon Capital Partners $300 Value-add
Partners Group Golden Coast (Co-investment) Partners Group $200 Opportunistic
Partners Group Real Estate Secondary 2017 Partners Group $100 Opportunistic
AEW Value Investors Asia III AEW Capital Management $100 Value-add
AEW Value Investors Asia III Coinvest AEW Capital Management $100 Value-add
LaSalle Asia Opportunity Fund V LaSalle Investment Management $100 Opportunistic
Meyer Bergman European Retail Partners III Meyer Bergman $154 Value-add
CrossHarbor Strategic Debt Fund CrossHarbor Capital Partners $100 Value-add
CrossHarbor Strategic Debt Fund (Co-investment) CrossHarbor Capital Partners $21 Opportunistic
J Cal (Joint Venture) J.P. Morgan Asset Management $500 Core
LDP Cal I (Joint Venture) BlackRock $200 Opportunistic
CSHV Santa Clara Ph3 (Separate Account) CBRE $157 Core
Artemis Real Estate Partners Healthcare Fund I Artemis Real Estate Partners $100 Value-add

CalSTRS also committed $495 million in real estate debt through a joint venture with PCCP, PacificCal Debt II, and $300 million to Beacon Capital Strategic Partners’ VIII fund.
In addition, the pension fund’s current real estate allocations as of Dec. 31, 2017, include: Core ($16.798 billion/62 percent); Opportunistic ($5.345 billion/22 percent); Value-Add ($4.503 billion/16 percent); Total – Real Estate ($26.646 billion) Total – CalSTRS ($215.318 billion); Real Estate percent of Total (11.83 percent).
CalSTRS has a target allocation to real estate of 12 percent.

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