posted on May 20, 2010 23:17
The Lionstone Group is partnering with the Teacher Retirement System of Texas to acquire as much as $500 million worth of real estate across the country.
The partners will invest $250 million matched by $250 million in lender financing to achieve the $500 million buying power.
The Lionstone real estate investment firm will act as general partner of the fund. Acquisition targets include office, multifamily, retail and industrial assets.
The Teacher Retirement System of Texas serves more than 1.2 million participants, providing retirement benefits as well as health insurance to the state’s public school teachers and administrators. As of Aug. 31, 2009, the system’s net assets totaled about $87.7 billion.
This is not the first state retirement system partner for Houston-based Lionstone, which was formed in 2001 by partners Tom Bacon, Dan Dubrowski, and Glenn Lowenstein.
In 2006, Lionstone created a $200 million fund with an investment capability of $400 million with the California State Teachers’ Retirement System, known as CalSTRS. The amount of equity invested by the partners was ultimately less than the $500 million originally announced.
The local firm also struck a similar deal back in 2002 with the Oregon Public Employees Retirement Fund, or OPERF. The resulting investment vehicle launched with $75 million and got another cash infusion of $50 million in 2004 from OPERF. As profits have been reinvested in the fund over time, it has grown to $250 million, said Dubrowski.
May 14th, 2010 | Houston Business Journal | Jennifer Dawson