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Minnesota earmarks $100m to Rockwood’s tenth fund

The State Board of Investment made its first commitment to the New York-based private equity real estate firm.

The Minnesota State Board of Investment (SBI) allocated $100 million to Rockwood Capital’s tenth value-added real estate fund earlier this month, according to a document from the pension fund.

The commitment marked SBI’s first investment with New York-based Rockwood, which launched Rockwood Capital Real Estate Partners Fund X in July 2015, according to a filing with the US Securities and Exchange Commission. The firm has not yet reported any closings for the fund with the SEC and has collected about $600 million, according to PERE research.

Other investors in the tenth fund include the Public Employees’ Retirement Association of New Mexico and Kentucky Teachers’ Retirement System, which each allocated $60 million, and the Illinois Municipal Retirement Fund, which invested $50 million, according to PERE research. SBI had $1.5 billion in commitments to seven other real estate fund managers as of March 31, according to its first quarter investment report.

Rockwood declined to comment, but the firm reportedly is seeking to raise up to $1.1 billion for Fund X and is targeting a 12 percent to 14 percent net internal rate of return. With capital from the fund, the firm plans to invest across property types in the US, focusing on neighborhoods drawing young professionals to live and work, according to Real Estate Alert. The firm’s predecessor vehicle, which was launched in 2012, closed on $678 million and is fully invested, according to PERE research.

Threadmark Partners, IBK Securities and Park Madison Partners are acting as placement agents for the fund, according to the SEC filing.

Rockwood’s most recent publicly available acquisition was the March purchase of a 23-story Los Angeles office building with Lincoln Property Company for $128.5 million, according to real estate data provider Real Capital Analytics (RCA). The companies plan to update the ground floor lobby, valet area and outdoor patio space, and replace the building’s elevators, according to RCA.