Illinois Municipal Retirement Fund, Oak Brook, on Friday approved a total of up to $325 million in commitments to three real estate funds and one private equity manager.
The board of the $42.4 billion pension fund committed up to $150 million to Blackstone Real Estate Partners IX, up to $100 million to Oak Street Seeding and Strategic Capital Fund II and up to $25 million to LaSalle Income & Growth Fund VIII.
The Blackstone Group fund targets global opportunistic real estate and the LaSalle Investment Management fund invests in value-added real estate. The Oak Street Real Estate Capital emerging manager fund of funds targets income-producing properties.
IMRF previously invested a total of $664 million with seven Blackstone funds, $100 million with two Oak Street funds and $45 million with two LaSalle funds.
Also, the board committed up to $50 million to ABRY Partners IX, a buyout fund targeting communications and business services firms.
ABRY previously has been assigned a total of $218 million in 13 funds.
The pension fund has a 9% target allocation to real estate and a 7% target to alternative investments; its actual allocations as of Sept. 30 were 6% and 4%, respectively.
Also Friday, the board scheduled a vote for Dec. 14 on changing its assumed annualized rate of return from the current 7.5%. Actuary Gabriel Roeder Smith in a report to the board recommended reducing the rate to somewhere between 6.2% and 6.8%; no recommendation for a new rate was discussed by trustees pending notification of IMRF member employers of the potential change.
Separately, IMRF returned a net 3.13% in the third quarter vs. the custom benchmark return of 3.07%, driven by its U.S. equities portfolio, according to a report to the board from investment consultant Callan.
However, in October, Illinois Municipal returned -5.45% vs. its -4.3% benchmark. Dhvani Shah, chief investment officer, told the board that the month's return brought the pension fund's return year-to-date Oct. 31 into negative territory — a net -1.08%, vs. the -0.62% benchmark return.
For the 12 months ended Sept. 30, the pension fund returned a net 8.56% vs. the benchmark's 7.61%.
