MARCH 31, 2014

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New Mexico to invest $150m in REITs

by Reg Clodfelter

The approximately $19 billion New Mexico State Investment Council has approved a motion to invest $150 million in preferred REIT investments. The capital is expected to be invested over the coming months, though there is currently no fixed timetable.

Charles Wollman, director of communications with NMSIC, has confirmed the approval.

Though this is NMSIC’s first ever REIT investment, it has been discussed as a possibility since 2011. Board documents note that the investment council chose to invest in REITs because they are income producing, a hedge against inflation and historically have shown a low correlation to other assets classes, including corporate and government bonds. The council also felt that REITs’ resilience during the global financial crisis was a compelling advantage to the asset class. NMSIC is seeking a 7 percent to 8 percent dividend return on REIT investments.

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