City Pension Funds Buy Sandy-Stricken Commercial and Residential Real Estate

NEW YORK CITY-Four of the city’s five pension funds have voted to invest $500 million in residential and commercial real estate, focused in areas affected by Superstorm Sandy, it was announced earlier this week by City Comptroller John Liu. The move is expected to bring the city about $1.5 billion for approximately 3,000 units of housing and 150,000 to 200,000 square feet of commercial space.  

The projects will develop in the coming months as the money is invested in repairs and construction over the next three years. Most of the housing restored and rebuilt by the funds’ investment will be in the affordable class, with the projects concentrated in the outer boroughs. The investments will be made by two newly formed partnerships with Related Cos. and the Hudson Cos. Inc., which will receive $300 million and $200 million respectively, from the funds. The funds are expected to earn a risk-adjusted market rate of return on the investments.