
PAG boss Shan Weijian
The second largest pension manager in the US committed $825 million to funds investing in Asia Pacific real estate during the first half of 2022, including vehicles backed by PAG, Greystar and Blackstone, according to a recent disclosure.
The California State Teachers Retirement System (CalSTRS), which manages nearly $305 billion on behalf of the Golden State’s public educators, said this week that from January to June it had agreed to invest $200 million in PAG Real Estate Partners (PREP) III, a pan-Asian core-plus/value-add real estate vehicle managed by Hong Kong-based PAG and put forth another $125 million for Greystar Equity Partners Asia Pacific Fund I.
Beyond those two APAC-only strategies, CalSTRS over the same period committed $500 million to Blackstone Real Estate Partners X (BREP X), the tenth edition of the US private equity firm’s global opportunistic fund.
The commitments by the Sacramento institution came as closings by real estate fund managers during the first half of 2022 saw a 22.2 percent increase in capital commitments compared to the same period one year earlier, according to statistics from industry data provider RealFin, despite concerns that rising inflation and geopolitical tensions could dent investor confidence.
APAC Value-Add
CalSTRS’ disclosure shows PAG continuing to raise cash from US pension managers for its third pan-Asian real estate fund, after the firm led by Weijian Shan secured a $50 million commitment from the Employees Retirement System of Texas in January of this year.

Adam Pillay of Greystar
While no target has been officially announced for the vehicle, which focuses on generating income-driven returns in gateway cities across Asia, its predecessor reached a $2.25 billion final close in 2019, which was 12 percent beyond its original target. By June of 2021 PREP II had achieved an internal rate of return of 11.53 percent, according to Realfin, with CalSTRS having made a $100 million commitment to the vehicle. Texas ERS had also contributed $100 million to the fund.
Greystar Equity Partners Asia Pacific Fund I, which invests in multi-family projects across Australia, Japan, China and other markets in the region, also received some help from the Lone Star State earlier this year when the Texas Teacher Retirement System committed $150 million in May. That contribution by the $26.5 billion pension fund manager came after Greystar told Mingtiandi in March that it had set a target of $1 billion for the strategy.
Blackstone’s BREP X frequently invests alongside the firm’s Blackstone Real Estate Partners Asia Strategy, with the third edition of that vehicle currently working toward a planned $9 billion closing.
CalSTRS commitment to BREP X came soon after the fund was launched in March with a target of $30.3 billion, which would be 50 percent larger than its predecessor fund, according to Blackstone’s latest earnings call.
Asia Endures
CalSTRS 2022 bets increase the pension fund manager’s exposure to Asia Pacific, as the region continues to attract global capital.
During the second half of last year the retirement scheme committed $300 million to LaSalle Investment Management’s sixth Asian opportunistic real estate fund, and in the first six months of 2021 CalSTRS agreed to invest $150 million in real estate investment manager AEW’s fourth Asia Pacific value-add fund.
In the first half of 2022 CalSTRS committed a total of $3.84 billion to real estate strategies, according to the statement, with less than 10 percent of that going to Asia Pacific-specific vehicles.
In the second quarter of this year, 14 percent of the capital raised for private real estate investment funds targetted the APAC region, according to Realfin.
For CalSTRS, which ranks behind only the California Public Employees Retirement System (CalPERS) among America’s largest pension managers, its commitments to real estate funds in the first half of this year marked a more than five-fold increase in its investments in the asset class after the fund committed just $700 million to such vehicles in the first six months of 2021.
Currently, CalSTRS has 16 percent its assets under management in real estate, above its target of 14 percent for the asset class, the pension fund said in a separate report.
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