Searches and Hires

Texas Municipal commits $144 million to 2 real estate funds

Pension fund returns 7.5% for year ended June 30

Texas Municipal Retirement System committed a total of up to $144 million to new funds offered by existing real estate managers.

During its Aug. 23-24 board meeting, trustees of the $28.6 billion pension fund approved a commitment of up to $75 million to Torchlight Debt Opportunity Fund VI, spokesman Bill Wallace confirmed in an email.

The Austin-based pension plan committed $75 million in 2015 to the previous fund in Torchlight Investors' real estate debt fund series. Portfolio managers of both funds seek non-core investments in U.S. value-added opportunities.

Real estate investment officers of the municipal pension plan also reupped with pan-European real estate manager Tristan Capital Partners with a €60 million ($69 million) commitment to European Property Investors Special Opportunities 5. The fund's managers will focus on opportunistic investments in office, logistics, retail and residential properties across Europe. The pension fund committed $33 million in 2015 to the fourth fund in Tristan Capital Partner's opportunistic real estate fund family.

Separately, TMRS returned a net 7.5% in the year ended June 30, compared to 7.1% for its policy benchmark.

The annualized net return of the pension fund over the five years ended June 30 was 7% vs. 6.7% for the benchmark, according to a report presented to the board during the meeting.

Mr. Wallace did not provide longer-term annualized returns in response to an email request from Pensions & Investments.

The one-year net return of TMRS as of June 30, 2017, was 10.4%; the benchmark return was not provided in a performance report provided to the board at its Aug. 18, 2017, meeting.

The asset allocation for the fund as of June 30 was 37.9% equities, 31.7% fixed income, 10.3% real return, 9.8% hedge funds, 8.9% real estate and 1.4% private equity.