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NYSCRF Bulks Up on Real Estate Investments in December

The $275 billion pension giant committed more than $2 billion in total for the month.

By Michael Katz




The New York State Common Retirement Fund committed more than $2 billion to new investments in December 2024, more than half of which was allocated to real estate investments, according to the pension fund’s monthly transaction report.

Within its real estate portfolio, the $275 billion pension giant earmarked $400 million to the IPI Partners III fund managed by IPI Partners LLC, a new relationship for the NYSCRF. The fund will focus on data center investments worldwide. The NYSCRF committed another $100 million within its real estate portfolio to the IPI Partners III Co-Investment fund, which will invest alongside IPI Partners III.

The pension fund also acquired Simone Little Italy, a 395-unit, 36-story luxury high-rise apartment building in San Diego for $283 million. Another $247.5 million was spent on the acquisition of the Royce, a 520-unit, multi-family property in Irvine, California.

The NYSCRF also made commitments worth $500 million within its opportunistic absolute return strategies portfolio. The fund is investing $300 million in the B Capital Global Growth IV fund from B Capital Group Management. The fund invests in early-stage to late-stage growth tech companies. Another $200 million will go to the B Capital Co-Invest Fund, a sidecar co-investment vehicle.

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Within its credit portfolio, the pension fund is allocating $100 million to the Pearl Diver Nautilus Series 2024 fund managed by Pearl Diver Capital. The fund will mainly invest in debt and equity tranches of collateralized loan obligations managed by third-party investment firms. It may also invest in CLO warehouses.

The fund committed $50 million to the Emerging America Credit Opportunities Fund from Capital Partners. The fund provides debt and flexible credit solutions to sponsored and non-sponsored lower-middle-market companies and will comply with certain requirements of the Small Business Administration for qualified small business investment company funds. Another $25 million was set aside for the Emerging America Credit Opportunities SMA I Fund, a separately managed co-investment sidecar that invests alongside the Emerging America Credit Opportunities Fund.

Within its private equity portfolio, the pension fund invested $200 million in the Summit Partners Co-Invest fund from Summit Partners. The fund will invest alongside Summit Partners Growth Equity Fund XII, which will primarily be utilized in the U.S.

The pension fund also committed approximately $15.2 million to the Warburg Pincus Jovian FS fund managed by Warburg Pincus. The fund will complete follow-on investments in portfolio companies transferred out of the Warburg Pincus Financial Sector portfolio.

Within the NYSCRF’s emerging managers program, which was established to invest in newer, smaller and diverse investment firms, the fund allocated $15 million to the AUA Private Equity Partners Fund III, which will make “control-oriented” investments in family-owned businesses in the consumer sector, with a focus on food manufacturing and distribution.


Related Stories:

New York State Pension Commits Nearly $3B to Private Equity in November 2024

New York Common Leads All US Public Pension Funds in Commitments to Diverse Firms

New York State Pension Earmarks $850M for Private Equity, Credit Investments

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Home > News > Pensions > MassPRIM Reports 9.1% Return in 2024, Assets Reach $109.7B
Pensions

MassPRIM Reports 9.1% Return in 2024, Assets Reach $109.7B

PRIM’s returns in 2024 were driven by a boom in equities.
By Matt Toledo



Massachusetts Pension Reserves Investment Management, which manages the state’s Pension Reserve Investment Trust, announced Tuesday that the pension fund returned 9.1% in 2024, underperforming its benchmark’s return of 9.7%.  

Assets of the pooled investment fund, which counts public employees and teachers in Massachusetts as beneficiaries, reached $109.7 billion at the end of the year after peaking at $110.5 billion at the end of September 2024.  

Over the past three, five and 10 years, MassPRIM achieved annualized returns of 2.4%, 7.7% and 7.6%, respectively. As of the end of Q4 2024, the fund has an asset allocation of 39.4% to equities, 16.6% to private equity, 14.8% to core fixed income, 9% to real estate, 8.7% to portfolio completion strategies, 7.7% to value-added fixed income and 2.9% to timberland.  

Global equities, unsurprisingly, were the fund’s best-performing asset class in 2024, with a 16.2% return in the calendar year, slightly underperforming the benchmark of 16.5%. Only real estate and core fixed income had negative performance, with the asset classes returning negative 3.1% and negative 1.4%, respectively. 

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Rising interest rates, slowing fundamentals and a soft West Coast market were cited as reasons for weaker real estate returns by Michael Trotsky, MassPRIM’s CIO, in the Tuesday meeting. Michael McElroy, PRIM’s director of public markets, noted that external managers moving away from the Magnificent Seven large-cap tech stocks were one reason for the slight index underperformance in equities.  

Portfolio completion strategies returned 13.4%, value-added fixed income returned 10.2%, and private equity returned 7.8% in the calendar year. Timber returned 3.0%. 

Manager Selection 

In 2024, PRIM adopted a new multi-asset credit mandate that would re-allocate $1 billion from existing bank loan managers to new managers that would invest across the credit spectrum.  

At its board meeting, the fund made commitments to two managers: Ares Management LLC and Beach Point Capital Management. PRIM staff recommended the investment committee approve initial allocations of up to $800 million to Ares and $400 million to Beach Point, both of which manage various credit strategies. 

The fund also approved a $125 million commitment to early-stage venture capital manager Tiger Iron Capital LLC and its Tiger Iron Bay State Fund L.P. The fund is structured as a fund-of-one, for which PRIM would be the sole limited partner. PRIM has not previously invested with the manager. 

In 2024, MassPRIM committed $2 billion to four value-added fixed-income managers, $1.2 billion to three international growth equity managers and $500 million to one U.S. large-cap equity manager. The fund also made $1.6 billion in commitments to private equity managers.  

2025 Goals  

According to information prepared for the meeting, PRIM plans to develop in 2025 a primer on the total portfolio approach to investing and its application at the fund.  

PRIM stall also said the fund wants to make $2 billion to $3 billion in commitments to private equity funds, co-investments and secondaries opportunities this year. Over the long term, the fund expects private equity to outperform public equity by 3%, despite weaker recent private equity performance, Trotsky said at the meeting. 

Last year, PRIM began exploring uses for artificial intelligence. This year, PRIM wants to continue to explore potential applications of AI in investment analysis and monitoring processes, as well as how AI can be used across the fund’s business functions.  

MassPRIM also wants to continue to source and evaluate diverse and emerging investment managers. Tiger Iron Capital, founded in 2016 and based in both Boston and San Francisco, was listed as a diverse-owned firm in the fund’s investment committee materials. Last year, PRIM committed more than $1.4 billion to diverse managers.  

 

Related Stories: 

Mass PRIM Achieves 9.9% Return in Fiscal 2024 

Mass PRIM Allocates More Than $2B to Credit Managers in New Commitments 

U.S. Large-Cap Equities Drive Mass PRIM’s 11.4% Return in 2023 

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