The Nebraska Investment Council has increased its relationships with Landmark Real Estate Partners and Realty Investors with new commitments totalling $100m (鈧�94.4m).
The pension fund made investments of $60m into the UBS Trumbull Property Income Fund and $40m into Landmark Real Estate Partners VIII.
Michael Walden-Newman, state investment officer for Nebraska, said: 鈥淲e have a very good relationship with both of these managers and have been pleased with their investment performance. There was no need to look elsewhere to add to our manager list.鈥�
The pension fund made both commitments on the recommendation of Aon Hewitt.
Landmark Partners is targeting a $2bn capital raise for Partners VIII, making a $5m co-investment in the fund.
Leverage will be no more than 70%.
The overall investment strategy is to acquire limited-partnership interests in existing funds, partnerships and other structured entities invested in underlying real estate.
Up to 30% of the fund, which will target a 15%-plus net IRR, can be invested outside the US.
The $2bn UBS Income Fund is one of the few core open-ended funds in the US that has a debt component.
It invests primarily through participating mortgages.
The fund structures its loans to receive interest on the loan, a share of the property鈥檚 operating cash flow and a share of the appreciation of the property.
The capital from Nebraska will not go into the fund immediately.
According to a board-meeting document, there is currently a 3-5 quarter queue in the fund鈥檚 registered interest list.
The Income Fund has an investment objective to provide a 5% real return on a 3-5 year basis and an 8-9% net return over a full market cycle.
The fund is 71% invested in apartments, 15% in retail, 6% in industrial and 8% in hotels.
Nebraska started its relationship with Landmark in 2010 with a $40m commitment in Real Estate Partners VI and made a $50m commitment into Partners VII in 2014.
The net IRRs for these two funds as of June of this year were 22.5% for Partners VI and 44% for Partners VII.
Nebraska made an initial $60m commitment into the UBS Income Fund in 2014, an investment that has produced a net IRR of 10.78% since inception.
