Sacramento County Employees’ Retirement System (SCERS) plans to make $270 million (€261 million) of investments in its fixed assets and real estate portfolios next year.
The $12 billion pension fund said in a meeting document that it expects to invest $190 million in real assets and make $80 million in real estate investments in 2023.
For investments in real assets, SCERS intends to issue commitments of approximately $50 million each in up to six funds. The pension fund’s plan during the period includes making follow-on investments with existing managers/strategies, pan-Asia infrastructure and environment-driven strategies such as decarbonisation and energy transition, and agriculture.
Steve Davis, SCERS CIO, said: “Pan-Asia economies are expected to grow faster than Europe and North America. Coupled with few institutional managers focusing on pan-Asia infrastructure, there is less competition for deals that offer potential better relative returns.”
SCERS said the amount set aside for property investment is expected to be invested in up to four funds. The pension fund’s plan involves evaluating Asia’s core/core-plus and value-adding strategies. SCERS will also consider investing in refrigerated logistics and cold storage assets globally.
Davis said: “In refrigerated logistics, there is excessive demand coupled with undersupply. In the US, the average age of cold storage is more than 30 years old and is only now gaining interest from institutional investors.
“In Asia, there are far fewer cold storage facilities, but consumer demand is high, offering a potentially better risk-reward compared to the US.”
SCERS also disclosed in the meeting document that it plans to rebalance the pension fund’s US open-end portfolio to help bring the strategy and geographic mixes within targeted ranges.
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