Oregon Investment Council, Tigard, which runs the $79.1 billion Oregon Public Employees Retirement Fund, Salem, plans to make $1 billion to $1.4 billion in new real estate commitments this year, according to materials on the council's website.
Oregon's 2020 initiatives for its real estate portfolio include making seven to nine commitments of $100 million to $300 million each. The council committed $1.1 billion to five real estate strategies in 2019.
Some 70% of Oregon's real estate portfolio is invested in separately managed accounts and open-end funds. The council's long-term plan is to have 55% of the portfolio in separate accounts and joint ventures, 10% in open-end funds, 5% in real estate investment trusts and 10% to 30% each in opportunistic and value-added closed-end funds.
Long-term goals for the portfolio are to underweight office and continue to overweight industrial, multifamily and, to a lesser extent, niche strategies such as senior living, campus housing, self-storage and medical/life science office. As of Sept. 30, 64% of the real estate portfolio is invested in core with 12% value-added, 17% opportunistic and 7% publicly traded.
The staff is not pursuing real estate credit investments because officials do not think it is a good long-term portfolio fit. The staff has created a transfer-to-core strategy in which properties in its value-added portfolio that achieve stabilizing milestones, upon staff approval and a third-party appraisal, are transferred to the core portfolio. The strategy saves on trading costs and also does not require the real estate manager to sell the property.