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Marin County swaps separate account for funds

The San Rafael, California-based pension plan will sell off the properties in its separate account with Woodmont Realty Services and reinvest much of the capital in core funds.

The San Rafael, California-based Marin County Employees’ Retirement Association (MCERA) is planning to sell its real estate assets from a separate account with Belmont, California-based Woodmont Realty Services and reinvest roughly $100 million of the proceeds into commingled funds.

MCERA’s investment committee first made the decision in March to sell the six properties in the fund’s direct real estate portfolio with Woodmont, MCERA spokesperson Sydney Fowler told PERE. MCERA chose to sell the properties due to current market pricing and to provide greater diversification in its portfolio, according to pension documents.

In June, the investment committee voted to reinvest the capital from the sale of the properties into two of its current open-ended core fund relationships: AEW Core Property Trust and UBS Trumbull Property Fund. At its most recent meeting in August, the committee determined the size of the new commitments to AEW and UBS.

The Woodmont portfolio, which is comprised of properties throughout northern California, has a current market value of approximately $130 million. Under advisement from consultant Callan Associates, MCERA has decided to commit $100 million from the proceeds to the two core funds at this time, with an investment of $50 million in each. With the additional commitments, MCERA will have approximately $150 million allocations to both the AEW and UBS funds. The additional $30 million in proceeds will be invested in the real assets portfolio, although MCERA has not determined in what capacity. 

Following the sale of the properties and the reinvestment of proceeds, MCERA’s real estate portfolio will comprise 11.8 percent of its total assets. The $1.94 billion pension system has a 15 percent allocation to the asset class.