CalSTRS invests heavily in real estate debt, offices and secondaries

Publication: IPE Real Assets
BY Jon Peterson

California State Teachers’ Retirement System (CalSTRS) has been seeking to increase its exposure to real estate debt, offices and property funds via the secondary market.

As part of more than $2bn (€1.74bn) committed to real estate strategies in the second half of 2019, the $252bn pension fund allocated $648m to real estate debt investments.

CalSTRS confirmed to IPE Real Assets that it had committed $300m to 3650 Cal Bridge Lending, a real estate debt joint venture it established with 3650 REIT in 2018.

The pension fund said it had also committed $198m to PacificCal Debt III, a joint venture with PCCP, and increased its existing investment in an open-ended real estate debt fund managed by CrossHarbor Capital Partners by $150m.

CalSTRS also allocated $300m of new capital to BCal II, an existing joint venture with Beacon Capital Partners that invests in core US offices, and committed $300m to the office-focused DivcoWest Fund VI.

The pension fund is also investing in real estate funds on the secondary market, having set up a $400m separately managed account with Blackstone Strategic Partners.

Other commitments in the second half of 2019 included a $300m allocation to StradaCal, a joint venture targeting core apartments and mixed-use assets in the San Francisco Bay Area and West Coast markets.