Greater Manchester Pension Fund is outsourcing its UK property portfolio to LaSalle Investment Management.
The 拢750m (鈧�944m) mandate will see LaSalle manage existing GMPF properties as well as invest in new properties in the UK. The mandate could increase to 拢1bn.
The pension fund its domestic real estate portfolio last year. As reported in November last year, Peter Morris, director of pensions at GMPF, said the fund did not possess the internal resources to increase the value of the fund鈥檚 property assets and the size of its holdings.
GMPF鈥檚 tender came with a requirement that an external manager had at least 拢3bn of UK property assets under management. LaSalle said it currently manages around 拢10bn in the UK.
GMPF鈥檚 seven-year contract mandate includes a four-year framework agreement with CBRE and DTZ, in effect making them 鈥檅ack up鈥� managers. As previously reported, the mandate had an option to extend by five years and comes with triennial fee reviews.
According to the pension fund鈥檚 2013 annual report, property made up around 6-7% of its 拢12.6bn portfolio, with a benchmark allocation to the asset class of 10%.
LaSalle, which has $50bn of assets under management, said it would initially target UK properties up to 拢75m on behalf of the fund.
Councillor Kieran Quinn, Tameside Council leader and GMPF chair, said: 鈥淭his is a significant mandate which can rise up to 拢1bn and we hope that LaSalle can make a significant long-term contribution for the fund鈥檚 returns.鈥�
