US - The $156bn California Public Employees Retirement System (CalPERS) and Rodamco North America (RNA) have teamed up to purchase three US shopping malls for a total of $1bn.
The deal, which is expected to close within the next 30 days, will see RNA and the pension fund giant take control of the Illinois-based Oakbrook Centre, the Century City Shopping Centre in Los Angeles, and the retail portion of the Galleria, a mixed use development in Houston. Under the terms of the joint venture, CalPERS will take a minority stake in the three malls and will assume a pro rata share of the existing mortgage payments.
Speaking about the deal, Daniel Szente, CalPERS chief investment officer, said: These malls are a welcome addition to our real estate portfolio. We've been able to capture a profitable segment of the retail market by partnering with a leading retail property investment company. These are quality properties that will offer us greater diversification in our real estate portfolio and the potential for strong returns.
Presently, CalPERS’ real estate portfolio is valued at $12.4bn, and represents approximately 8% of CalPERS total assets. Approximately $9.8bn is invested in office, retail, industrial and apartment properties. The pension fund’s housing, timber, franchise finance, and net-leased investments are valued at $2.6bn, whilst retail investments account for $2bn.
RNA has also announced that it has rejected Australian real estate group Westfield Holdings' plan to take over the management of its property holdings. Earlier this week, Westfield announced that it had bought a 23.9% interest in RNA from Dutch pension fund giant ABP. The external management plan, devised by ABP and Westfield, has been labelled by RNA as excellent for Westfield, but very bad for all other RNA shareholders.
By Geoffrey Ho
Newton Investment Management's series of DC columns continues with Gerald D Rehn of BNY Mellon forecasting innovation in the market
Pension Insurance Corporation (PIC) has agreed to a 30 year debt investment in Phoenix Community Housing, a not-for-profit, resident-led housing association in London.
Royal London has announced plans to allow customers with guaranteed annuity rates (GARs) to convert their guarantees into a top-up for their pension pot, subject to High Court approval.
The Salvus Master Trust will welcome another 1,200 members and 20 employers as it absorbs the £7m Complete Master Trust.