It has been a busy year for one of the country’s largest public pension systems.
The California Public Employees Retirement System, (CalPERS) has committed to invest a total $1.9B in U.S. multifamily and office assets through two partnerships.
The pension will invest $1.2B through a partnership with Fifth Street Properties, in addition to a $700M capital injection in Institutional Multifamily Partners, IPE Real Estate reports.
“We [are] partners in the investments. Typically CalPERS is about 95% and the partner also invests alongside. There are some cases in private equity where we become an owner of the firm and have an equity stake, but not in these cases,” CalPERS Deputy Executive Officer Brad Pacheco said.
The two deals are among the largest of a slew of recent CalPERS investments made through its Real Assets Program, which is comprised of three divisions including real estate, infrastructure and forestland. Fifth Street, which is managed by CommonWealth Partners, intends to use the CalPER financing to buy existing large properties and put capital into value-add assets, IPE Real Estate reports.
While CalPERS owns most of the assets in the Fifth Street partnership, CommonWealth will oversee the direction of the funds in the venture.
IMP will invest the new capital into the purchase of core apartments in major U.S. markets including San Francisco, New York, Denver and Southern California.