Wednesday, March 30, 2016

New Jersey sets aside $100m for Exeter industrial fund

by Jon Peterson
The New Jersey Division of Investment is planning a $100m commitment to Exeter Property Group’s Core Industrial Club Fund I.

To date, the pension fund has invested 12% of its private real estate in industrial assets, compared with the NCREIF ODCE index’s 14%.

The US investor said that, with only nominal unfunded commitments in the industrial sector, it expected exposure to fall further.

The new commitment will allow it to rebuild the amount invested in industrial assets.
The commitment will represent 16.67% of Exeter’s planned $600m capital raise.

The new fund, aiming for a 8.5% return, will invest solely in US industrial properties.

Around 75% will be in bulk warehouses and multi-tenant logistics assets, and 25% in “last mile” distribution properties.

Exeter Property Group plans to focus on core and core-plus assets.

Any development the fund does would be limited to forward-funding of build-to-suit properties.

The pension fund said Exeter’s Core Fund I generated a 20.1% IRR and a 9% cash yield.

New Jersey is also planning a $100m allocation to the Wheelock Street Real Estate Fund V.

Wheelock is aiming for a $700m capital raise, with a $725m hard cap.

The opportunistic fund will invest in a variety of US properties, portfolios and operating companies through its hotel, retail and residential verticals or through joint ventures with leading operating partners.

Wheelock is co-investing 2.5% of total capital commitments, with the fund using 50% leverage.
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