Greystar Raises $25M From Texas Teachers for APAC Value-Add Fund

The Teacher Retirement System of Texas committed $25 million to a Greystar Asia Pacific value-add fund in March, marking the pension plan’s first capital allocation to APAC real estate in 15 months.

TRS made the pledge to Greystar GEPA CoInvest II on 19 March as part of the Texas institution’s $681 million in commitments last month to various real estate, private equity, energy and infrastructure strategies, as disclosed this week in a monthly update.

Greystar’s APAC value-add strategies focus on rental demand drivers like urbanisation, rising home prices and a growing preference for professionally managed housing. The US apartment giant recently closed on the A$1.6 billion ($1.01 billion) purchase of a seven-asset student accommodation portfolio in Australia.

“Australia’s student housing sector is experiencing strong demand, driven by its world-class education institutions, a growing international student population, and an undersupply of institutional-quality housing,” Greystar’s executive director of APAC investment management, Adam Pillay, said in announcing the deal in December.

PAG Commitments

Austin-based TRS, which manages $211.6 billion in assets on behalf of public education workers in the second-biggest US state, had made its most recent Asia real estate commitment in December 2023, when it allocated $100 million to Secured Capital Real Estate Partners VIII, the latest opportunistic strategy of pan-Asian fund manager PAG.

PAG in February announced the final closing of SCREP VIII with $4 billion in capital commitments, a feat it described as the largest dollar-denominated real estate fundraising dedicated to APAC in the preceding 12 months. The vehicle focuses on property and debt investments across developed Asia markets with its largest investment presence in Japan.

SCREP VIII is the follow-up in the fund family after SCREP VII reached a final closing of $2.75 billion in 2020. The prior vehicle invests in high-yielding real estate projects across Asia, with a particular focus on commercial properties in Japan, where the fund managers of the Secured Capital series are based.

TRS and another Texas pension fund, the Employees Retirement System, committed a combined $225 million to SCREP VII. PAG had also received commitments from TRS in the amount of $10 million each for two 2022-vintage opportunistic real estate funds, Kona Co-Invest and Mirai Co-Invest.

Real Estate Momentum

TRS’s March real estate commitments included $350 million for a US opportunistic fund managed by GCM Grosvenor and $100 million for a US opportunistic vehicle managed by 1 Seed Partners, both asset managers being headquartered in Chicago.

In addition, the pension system made a $6 million commitment to Blackstone Whitecap Co-Invest, an Asia-focused infrastructure fund of the Manhattan-based titan.

TRS committed $1.64 billion to private real estate funds in 2024, marking a 61 percent surge from the pension manager’s total commitment the year before. The annual increase was due entirely to TRS’s December real estate commitments totalling nearly $691.7 million, with the late boost ensuring that the full-year commitment would surpass 2023’s total of $1.02 billion.