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New Mexico SIC plans $525m for non-core real estate in fiscal 2023 – IPE Real Assets

New Mexico State Investment Council (SIC) has set a $525m (€533m) real estate pacing plan for the current fiscal 2023 year as it seeks to invest via non-core funds, according to a meeting document.

Real estate currently accounts for 10% of total plan assets compared with a 12% targeted allocation to the asset class.

The sovereign wealth fund told IPE Real Assets that the plan for the current fiscal year which started on 1 July includes expanding its real estate exposure in Europe to help diversify and to take advantage of opportunities in the region.

Europe real estate accounts for 9% of New Mexico SIC’s real estate portfolio. The long-term goal is to have the Europe portfolio between 10% and 20%. In the current fiscal 2023, New Mexico SIC intends to maintain its 6% exposure in Asia.

The investment plan for fiscal 12023 involves continuing the sovereign wealth fund’s over-exposed to industrial and multifamily/residential real estate and being under-weight to office and retail.

The investment during the period will be made via non-core funds to help rebalance the real estate portfolio which currently comprises 67% core compared with its 55% target. New Mexico SIC also believes the strategy will enable it to capitalise on market opportunities likely to be created in part by the US Federal Reserve Bank’s aggressive tightening in the US.

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