Texas Municipal Retirement System (TMRS) has said it is planning to invest in real estate through separate accounts and co-investments for the first time.

The $28.4bn (鈧�24.9bn) pension fund is entering into a 鈥渟trategic relationship鈥� with Transwestern Investment Group (TIG), which will enable it to take its 鈥渇irst steps into separate account investing and co-investing within the real estate portfolio鈥�, according to a board meeting report.

TMRS is allocating up to $250m to the relationship and has recommended increasing the maximum amount of capital it intends to deploy in real estate this year from $400m to $500m.

Transwestern will be able to invest across the risk spectrum, supplementing the pension funds鈥� existing core, value-add and opportunistic real estate investments.

The wider Transwestern group encompasses investment management, property services and development, and the TMRS report cited its 鈥減latform depth鈥� and 鈥渙perating capabilities鈥�.

Charles Hazen, president of Transwestern, said: 鈥淭MRS had a clear vision for the strategy, and we worked together to tailor a programme with enhanced visibility, control and cost efficiency to invest across multiple real estate investment risk-return profiles through TIG鈥檚 national operator platform.鈥�

TMRS is also planning to commit capital to two infrastructure funds managed by Global Infrastructure Partners (GIP) and InstarAGF Asset Management, respectively.

The pension fund is investing up to $200m with GIP鈥檚 infrastructure debt arm, GIP Credit, split into three commitments.

It will commit up to $75m to GIP Spectrum Fund, which provides senior debt for acquisitions or refinancings, and up to $75m to GIP Capital Solutions, which targets higher-return structured credit to fund growth and greenfield developments. The remaining $50m will be allocated for a co-investment vehicle to invest alongside GIP Capital Solutions.

TMRS also plans to commit up to $100m to InstarAGF Essential Infrastructure II, plus up to $50m in co-investment capital.

The fund focuses on middle-market infrastructure assets 鈥� with an enterprise value of between $100m and $1bn 鈥� in North America.

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