Tennessee Consolidated Retirement System has enlarged its real estate portfolio by $246m (€195m) through a combination of three separate account acquisitions and two fund commitments.
The separate account acquisitions total $136m in three core real estate investments.
Tennessee bought a 161,042sqft Rosendale Square shopping centre in Minneapolis, Minnesota through Deutsche Wealth & Asset Management. The purchase price was $33.6m, according to industry sources.
The pension fund also bought two industrial buildings in Chicago, Illinois through TA Associates. The two properties total 957,562sqft.
The other separate account deal was through . The 184,259sqft Westchase Corporate Centre office building in Houston is 93% let.
The two fund commitments were a $50m allocation to the Savannah Real Estate Fund III and a $60m commitment to the Berkshire Multifamily Value Plus Fund III.
Savannah, which invests in office buildings in northeast US and focuses on New York City, is aiming to raise $650m of equity, with a hard cap of $700m and leverage of 65%.
Targeted returns for the value-added fund are 11.4% unleveraged and 18.5% with leverage.
Berkshire is aiming for a total raise of $400m for the fund. The fund manager will make a $10m co-investment.
Fund III will invest in mezzanine debt, asset recapitalisations and development, with properties sourced off-market.
Targeted returns for the fund are 16.5% to 17.5% (gross) and 12% to 13% (net), with leverage on a portfolio basis of 50%.
