calpers

Business & Real Estate

By Dale Kasler
dkasler@sacbee.com
June 30, 2015

  • Pension fund continues to reshape portfolio
  • Goal is fewer speculative investments

CalPERS said Tuesday it plans to sell up to $3 billion worth of real estate as it continues to overhaul its investment portfolio.

The nation’s largest public pension fund said it wants to unload assets “that no longer align with the strategic goals of the real estate program.” CalPERS owns $25.5 billion in commercial, industrial and residential properties.

The decision is in line with the California Public Employees’ Retirement System’s decision to undertake a massive revamp of its land holdings following the market crash, which wiped out nearly $11 billion of value in the CalPERS real estate portfolio. Since then, CalPERS has focused on comparatively safe income-producing properties that have already been built, instead of riskier projects that it would build from scratch. It already has sold off hundreds of millions of dollars worth of properties that didn’t fit with the new vision.

“This is just a portion of that legacy portfolio,” said Joe DeAnda, spokesman for CalPERS. “Because of the favorable market conditions, we’re testing the market.” The pension fund hired Park Hill Group, a national real estate firm, to assist with the sale.

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