Virginia Retirement Adds $250M to RE Credit

The Virginia Retirement System added a real estate credit fund to its alternative investment portfolio early this month, according to transaction data.

The $110 billion retirement system has committed $250 million to ACORE Credit Partners II, a closed-end fund that invests in newly issued mortgages secured by transitional commercial real estate.

The strategy targets returns by originating transitional commercial real estate whole loans for high quality, well-capitalized operators and private equity sponsors, many of whom are repeat borrowers.

The move comes after the retirement system’s current private credit portfolio increased by more than 10% in the fiscal year ending January 31, as well as the hiring of Ares Management for a secondary mandate.

Last month, the New Mexico State Investment Council made an equal-sized investment to the real estate debt fund run by San Francisco-based ACORE Capital.