The California Public Employees’ Retirement System (CalPERS) has approved a new USD200 million program for emerging real estate managers who have less than USD1 billion of assets under management.
The term of the new Emerging Manager Program for Real Estate will be five years. CalPERS will review the progress and outcome of the program after two years.
“Our top goal is to achieve appropriate risk-adjusted earnings,” says Rob Feckner (pictured), CalPERS Board President. “We also hope to find investment opportunities in underserved sectors for sound long-term returns and to increase diversity among our pool of real estate investment managers.”
CalPERS will seek managers who have no more than three prior commingled funds or separate account investment vehicles. The pension fund will select from its current team of seasoned successful investment managers to oversee the selection of talented new managers, provide mentoring, and back office support. The program will focus on managers and assets in urban California markets.
"The Emerging Manager Program is another positive step in restructuring the Real Estate portfolio. This program will give us several new features including clearly-defined program parameters to provide appropriate and necessary support for emerging managers,” says George Diehr, Investment Committee Chair.
Approximately 20 to 50 firms are in the universe of emerging managers who might qualify for the new program, according to Crosswater Realty Advisors, which assisted CalPERS in research, design and development of the Emerging Manager Program.
