CalPERS Makes Additional $375MM Allocation into Emerging Manager Program

Bay Area, San Francisco, Oakland, San Jose, Silicon Valley, San Mateo, Santa Clara, Bay Area Council

By Jon Peterson

California Public Employees Retirement System has approved a new $375 million allocation into its real estate emerging manager program for real estate, as confirmed by the pension fund in an email.

Two of the managers that are in the emerging manager program are based in the San Francisco Bay Area and are active in that market. These are Rubicon Point Partners and Sack Properties. BKM Capital Partners is also in the program. This manager is based in Newport Beach and looks to buy assets in the area as well.

The capital supplied by CalPERS will be placed into the Canyon Catalyst Fund. The real estate manager on this fund is Los Angeles-based Canyon Partners, which has had a lasting relationship with CalPERS. This fund has a current net asset value of $543.5 million, according to industry sources. The pension fund last made an allocation into the fund in September 2017 when it approved an investment of $350 million.

The new allocation of $375 million will have a total capitalization of $750 million. This will be as a result of the program’s asset level leverage limit of 50 percent, as stated by Canyon Partners in an email.

The fund manager will be looking for long-term investment opportunities with this fund, confirming this in an email: “The goal of the fund is to put additional resources behind high-performing emerging managers who specialize in specific asset classes and, through mentorship by Canyon professionals, guide them in their growth at the corporate and professional investment levels.”

Rubicon Point Partners is known as an investor of both office asset and mixed-use properties in both the San Francisco Bay Area and the Pacific Northwest. Sack Properties can function both as a developer and buyer of residential properties in San Francisco, Oregon and Washington. BKM is a value-add investor in the industrial space.

There are two other managers that that are part of the CalPERS emerging manager program. These are Paragon Commercial Group and Pacshore Partners. 

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