Texas teachers’ pension fund makes huge investment in international real estate

The $3B pension fund will invest over $500M with various real estate investment vehicles

National /
May.May 18, 2019 11:00 AM
Lone Star's John Grayken (Credit: Getty Images and iStock)

Lone Star’s John Grayken (Credit: Getty Images and iStock)

The Texas teachers’ retirement fund is betting big on the international real estate market.

The $3 billion Teacher Retirement System of Texas announced it will invest over $500 million with Dallas-based private equity firm Lone Star Funds, plus another $150 million for an infrastructure fund, according to IP&E Real Assets.

About $300 million will be invested into Lone Star’s Real Estate Partners VI fund, which is seeking $3 billion for property investments in Western Europe, North America and Asia. The pension fund will also invest $200 million into the firm’s Residential Mortgage Fund II, which will invest in the U.S. mortgage industry.

The pension fund will also invest about $10 million into CBRE’s French Logistics Feeder, another real estate investment vehicle. The pension fund last year committed over $100 million to the investment pool, according to IP&E.

On top of it’s real estate investments, the retirement system will inject $150 million into the Global Energy & Power Infrastructure Fund III.

American public pension funds have increased their real estate investments by a measure of six times between 2006 and 2016. [https://therealdeal.com/2018/11/26/public-pension-funds-looking-for-more-exposure-to-high-risk-real-estate/] The funds are now seeking riskier, more opportunistic real estate deals as a means of closing funding gaps.

Manhattan real estate has been a target of public pension funds, but the strategy has not been adopted by New York City’s retirement systems. Instead, the city invested $4 billion of its pension funds into climate change solutions. [IP&E Real Assets] — Joe Ward


Related Articles

arrow_forward_ios
Adam America's Omri Sachs and Dvir Cohen with 2503-2509 Broadway (Google Maps; Adam America)

Adam America secures $63M in financing for Upper West Side project

Adam America secures $63M in financing for Upper West Side project
Convene CEO Ryan Simonetti (Convene)

Convene closes Manhattan locations as corporate events fail to return

Convene closes Manhattan locations as corporate events fail to return
New York City District Council of Carpenters’s Monitor Glen McGorty (iStock; LinkedIn)

NYC carpenters union changes how it roots out mob ties

NYC carpenters union changes how it roots out mob ties
The Economic Innovation Group identified 145 real estate investments in Opportunity Zones (iStock)

Real estate deals dominate Opportunity Zones. Is that bad?

Real estate deals dominate Opportunity Zones. Is that bad?
11 Penn Plaza and Apple CEO Tim Cook (VNO; Getty)

Apple snags more space at Vornado’s 11 Penn Plaza

Apple snags more space at Vornado’s 11 Penn Plaza
Amazon's Jeff Bezos, Google's Sundar Pichai and Facebook's Mark Zuckerberg (Getty, iStock)

Tech giants occupy nearly 600M-sf of US real estate

Tech giants occupy nearly 600M-sf of US real estate
Hana Financial Investment’s Lee Jin-Kook and a rendering of 1 St. Marks Place (Hana Financial Investments)

Hana Financial to sell loans tied to Manhattan office, hotel properties

Hana Financial to sell loans tied to Manhattan office, hotel properties
Cineworld Group CEO Mooky Greidinger and Regal Cinema (Photo via Getty; Wikipedia)

Regal Cinemas scores financial rescue package

Regal Cinemas scores financial rescue package
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...