Iowa Public Employees' Retirement System, Des Moines, terminated core real estate manager TA Associates Realty, which ran $293 million.
“We don't believe we need five core generalist managers anymore,” Judy Akre, director of communications at the $23.3 billion pension fund, wrote in an e-mail. TA Associates Realty was terminated because of “a combination of the decision to restructure and (to) performance,” she added.
“Some (of this money) will fund commitments to the real estate debt strategy, while the rest will probably be used for rebalancing,” she wrote.
A call to TA Associates Realty was not returned by press time.
Separately, the retirement system changed the $345 million real estate portfolio of UBS Realty from core “to be more of an apartment specialist to introduce a desired strategic exposure to apartments as an inflation hedge,” according to a printed summary of the board's June 21 actions.
“UBS has shown skill in managing apartment assets, and we would like our real estate portfolio to have a strategic tilt to apartments,” Ms. Akre wrote. “Apartment income generally adjusts more quickly to inflation because rents are reset annually.”
Ms. Akre added that “it's possible” some of the UBS non-apartment assets “will be sold over time, but it's too early to say where that money might be utilized.”