NYSTRS to invest in three funds

Among the $90.9 billion pension plan’s new commitments are its first ones to Gaw Capital Partners and Abacus Capital Group.

The New York State Teachers’ Retirement System (NYSTRS) has earmarked a total of $164 million to three commingled real estate funds during the first quarter, according to board meeting documents released this week. The commitments include $75 million to Gaw Capital Partners’ Gateway Real Estate Fund IV in January; $64.6 million to Perella Weinberg Partners’ Perella Weinberg Real Estate Fund II in March; and $25 million to Abacus Capital Group’s Abacus Multi-Family Partners II, also in March.

This marks the first time that the state pension system has committed capital to Hong Kong-based Gaw Capital and New York-based Abacus Capital. NYSTRS previously invested in Perella Weinberg’s Perella Weinberg Real Estate Fund I, closing on a €50 million commitment in November 2007.

Gateway Real Estate IV, which launched last year, is Gaw Capital’s fourth China-focused private equity real estate fund. Last month, PERE reported that the firm had raised about $340 million for the vehicle and was expected to hold a final close between $800 million and $1 billion, the fund’s hard cap, this summer.

Meanwhile, Perella Weinberg Real Estate Fund II is the New York-based firm’s second pan-European opportunistic real estate fund and is said to have raised €900 million in equity commitments to date against a €1.2 billion target. A final close for the vehicle is anticipated during the first half of this year.

With its commitments to Gaw Capital and Perella Weinberg, under its global real estate allocation, “NYSTRS continues to diversify its real estate portfolio by selectively investing with investment managers with a global or non-US investment strategy,” a spokeswoman wrote in an email. Indeed, during the fourth quarter of 2012, the pension plan committed $50 million to Cerberus Capital Management’s latest global opportunistic real estate fund, Cerberus Institutional Real Estate Partners III.

The commitment to Abacus Multi-Family Partners II, meanwhile, falls under NYSTRS' value-added allocation. Abacus Capital held a first close of $45 million for its second US multifamily fund in August 2011 and had raised a total of $122.85 million against a $250 million target one year later, according to filings with the US Securities and Exchange Commission. The firm focuses on acquiring properties with between 200 and 400 units located in primary and secondary markets, particularly state capitals with strong educational infrastructure or near employment centers, according to its website.

“The multifamily housing market continues at a healthy pace with vacancy near its historical norm and rent growth slightly ahead of both the long-term average and consumer price inflation,” NYSTRS stated in the board meeting documents. “In addition to job growth, the rapid growth of households under the age of 35 and over the age of 65 remains a favorable tailwind for demand.”