560 Mission

SACRAMENTO-The California Public Employees’ Retirement System has transferred management of its National Office Partners real estate portfolio from Hines to CommonWealth Partners LLC, according to a CalPERS announcement. The pension fund describes the NOP as a $998 million portfolio ($724 million in market value plus debt) that consists of approximately 5.2 million square feet of class A office properties in markets across the US including Boston, Chicago, Seattle, San Francisco, Palo Alto, Minneapolis, Salt Lake City, Austin and Denver. The transfer is part of the pension fund’s broad strategic realignment of its real estate program, CalPERS says.

Among the assets in the CalPERS portfolio are the 660,00-square-foot 560 Mission in San Francisco and the 1.2-million-square-foot Harris Bank in Chicago. CommonWealth Partners is a privately held, vertically integrated real estate investment, development and management firm based in Los Angeles, with offices across the US. It has executed over $4 billion of transactions in other CalPERS partnerships, beginning in 1998, and will be an active investor on behalf of the pension fund with a significant capital allocation for investment across the country.

Harris Bank

Ted Eliopoulos, the senior investment officer who oversees more than $15 billion invested in CalPERS global real estate, commented: "CommonWealth Partners has done extremely well for us for over 12 years now, and we anticipate very good performance from them and the domestic office portfolio going forward."

Eliopoulos also said that CalPERS is pursuing opportunities with Hines on a global basis. The pension fund recently increased its allocation to a Hines-sponsored fund in Brazil by $190 million. It has active co-investment platforms with Hines in Asia, Latin America and Europe as well as investments in the US through the Hines CalPERS Green Fund focusing on sustainable development.

CalPERS, with approximately $222 billion in assets, is the nation’s largest public pension fund and administers retirement benefits for more than 1.6 million active and retired state, public school, and local public agency employees and their families.