Investors - FEBRUARY 12, 2015

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SFERS raises real assets target, commits $150m to Blackstone

by Reg Clodfelter

The $19.85 billion San Francisco Employees Retirement System has raised its target allocation to real assets from 12 percent to 17 percent, creating room for nearly $1 billion in additional investment to the asset class, confirms Norm Nickens, retirement board secretary. Additionally, the board has committed $150 million to Blackstone’s recently launched Blackstone Real Estate Partners VIII.

BREP VIII, which launched at the start of 2015, is expecting to hold a $10 billion close in March and could raise as much as $15 billion by its final close, which would make it the largest ever commercial real estate fund, surpassing its predecessor’s $13.7 billion final close from November 2012. Its predecessor generated a net IRR of 27 percent.

BREP VIII will look to generate a 15 percent net IRR by investing in distressed or non-stabilized assets through off-market, proprietary channels or through controlling positions in subperforming and nonperforming loan

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