Pension plans back Deutsche fund

Real Estate Alert, Feb 25, 2004

Deutsche Bank has raised $300 million of equity for its second global fund, including contributions from California State Teachers and Calpers.

CalSTRS supplied $60 million of equity, while Calpers kicked in $30 million. Other investors include North Carolina Public Employees and Colorado Public Employees.

The vehicle, DB Global Opportunities Fund 1B, is focused on buying distressed and underperforming international properties. The targeted return is more than 18%. With leverage, the fund could buy up to $750 million of properties.

The fund is a sequel to Deutsche's first global vehicle, which has $1.1 billion of equity. The new fund, which has the same investors, was designed to reinvest distributions from the earlier fund's 86 holdings--a mix of buildings, loan portfolios and operating-company investments in Europe, Asia and the Americas.

Each fund is designed to have a seven-year life cycle, with three one-year extension options.