During a recent investment committee meeting, the Connecticut Retirement Plans and Trust Funds (CRPTF) committed $450M to two core real estate investment funds focused on retail and niche sectors, such as medical office, data centers, and “other” residential including senior living.
CRPTF committed $150M to Sterling United Properties I Continuation Fund, which is a discretionary closed-end institutional equity fund focused on acquiring and operating stabilized or core grocery-anchored shopping centers in major U.S. markets.
While the retail sector has been out of favor, the fund’s investment team noted the lack of interest in the sector has opened opportunities in a market segment that continues to see “strong demand from healthy retailers and consumers” but very little new supply in more than 10 years. The investment would increase the fund’s exposure to the retail sector at a time where the market is experiencing improving capital market sentiment and liquidity through an “attractive seed portfolio of core plus retail assets with an existing specialized manager.”
The CRPTF also committed $300M to the TA Core Plus Realty Fund, which focuses on the logistics and multi-family real estate sectors within strategic U.S. markets. The investment would provide the pension fund with exposure to a vintage open-end fund that “consistently outperforms the benchmark index since inception.” Roughly $200M of the total allocation would be invested in 2025.
CRPTF’s total allocation to real estate is 6.3%, short of its target of 10%.
