Investors - OCTOBER 6, 2014

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Texas Permanent becomes nation’s largest educational endowment

by Reg Clodfelter

The Texas Permanent School Fund has grown to approximately $37.7 billion as of June 30, 2014, surpassing the Harvard Management Co., valued at $36.4 billion at the same time, as the nation’s largest educational endowment.

TPSF’s assets are divided between the $30.6 billion managed by the State Board of Education and $7.1 billion by the School Land Board. As of July 31, approximately $1.3 billion, or 4.14 percent of the SBOE-managed assets, are invested in real estate. The real estate portfolio had a fiscal-year-to-date return of 8.98 percent at the end of June, beating its benchmark, the NCREIF Property Index, by 60 basis points during that period. Its three-year performance is 10.67 percent, slightly short of the NPI’s 10.92 percent return during that period.

The school endowment has been an active real estate investor so far in 2014, committing $225 million in July, divided evenly between Ares U.S. Real Estate Fund VIII, Carlyle Realty Part

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