By Jon Peterson
San Francisco-based DivcoWest Properties has been on a capital raising roll over the past five months. The fund manager has received commitments of at least $965 million from new investors for its commingled fund DivcoWest Fund VI, according to public board meeting documents. These commitments are allowing the company to get close to its planned $2.5 billion hard cap for the commingled fund.
The largest of the new commitments was a $325 million contribution from the California State Teachers Retirement System (CalSTRS). The other commitments issued since November of last year have been $200 million each from the Massachusetts Pension Reserves Investment Management Board and Oregon Public Employees Retirement System, $100 million each from the New Jersey Division of Investment and the Teacher Retirement System of Texas and $40 million from the District of Columbia Retirement Board.
DivcoWest declined to comment when contacted for this story.
The commingled fund will have the San Francisco Bay Area and Seattle among two of its investment targeted markets. The others could include Boston, Austin, New York City and Washington, D.C.
Fund VI is a value-add commingled fund. It will mostly be buying a mixture of office, R&D and lab properties. Some of the strategies planned for assets in the fund included repositioning, releasing and redevelopment. The targeted preferred returns for the investors in the fund are 7 percent, according to board meeting document provided by the New Jersey pension fund.
Fund VI will be looking for properties that are targeting two main types of tenants. This would include mostly technology-based and life science types of businesses.