Louisiana Teachers’ makes big bet on European, North American real estate

  • Why is this important: BX and Rockpoint real estate funds have performed well
  • AUM: $19.5 bln
  • RE allocation: 9 pct; target 10 pct
  • PE allocation: 15 pct; target 14 pct
  • Whom to contact: Lisa Honore at lisa.honore@trsl.org
  • Investment Adviser: Hamilton Lane

Teachers’ Retirement System of Louisiana at its March meeting committed $125 million in private market investments, documents from the system’s investment adviser, Hamilton Lane, show.

TRSL commitments include:

  • $75 million to Blackstone Group’s Real Estate Partners Europe VI, targeting €8 billion ($9 billion).
  • $50 million to Rockpoint Group’s Real Estate Fund VI, targeting $3 billion.

Hamilton Lane told the system that Blackstone has experience working in the European real estate market and that previous funds have made consistent returns.

Blackstone’s fifth European real estate fund closed in 2017 on €7.8 billion ($8.8 billion) with a net internal rate of return of 19 percent as of Sept. 30, 2018.

Rockpoint’s sixth real estate fund focuses on North American markets. It’s performed consistently well in past funds, according to Hamilton. Its fifth fund closed in 2015 on $2.6 billion with a net IRR of 12.4 percent as of Sept. 30, 2018.

Louisiana’s actual real estate allocation is 9 percent, against a 10 percent target, and its PE allocation is 15 percent, exceeding its 14 percent target, as of Jan. 31, 2019.