CalSTRS Deploys $12B to Private Markets

The California State Teachers’ Retirement System (CalSTRS) accelerated its push into private markets in 2025, committing more than $12 billion across private equity and real estate, with a growing emphasis on co-investments and credit strategies. 

In the second half alone, the pension deployed $7.2 billion, following $5.2 billion in the first half, underscoring continued conviction in alternative assets. A key driver has been the expansion of co-investments, which now represent 24.6% of the private equity portfolio, as CalSTRS moves toward a 33% target. Second-half co-investments totaled $814 million, executed alongside partners including Advent International and Ares Management. 

Private equity commitments reached $3.4 billion in the latter half of the year, highlighted by $500 million re-ups to TPG Capital X and Blackstone Strategic X. The pension also allocated $250 million each to Sixth Street Opportunities Partners VI and Apollo Hybrid Value Fund III, reflecting a continued blend of equity and credit exposure. 

Within real estate, CalSTRS committed $3.2 billion, including a $500 million investment in IDR Industrial Index Fund, signaling sustained demand for logistics and industrial assets. The system’s $47.6 billion real estate portfolio has outperformed its benchmark by 1.1% over the past decade. 

Notably, CalSTRS is increasingly integrating private credit into its real estate strategy, with commitments to TPG Real Estate Credit Opportunities, PCCP Credit XI, and a $250 million Pearlmark co-investment.