Core and core‑plus real‑estate managers brief Mississippi PERS on valuations, redemption queues and reallocations

Managers for four core and core‑plus real estate mandates presented updates to the Public Employees Retirement System of Mississippi investment committee, outlining why performance has lagged recently, what valuation methods they used and how each plans to reposition portfolios.

Invesco: Layla DeCosta opened, "My name is Layla DeCosta. I'm a client portfolio manager with Invesco Real Estate," and handed the floor to lead manager Dan Kubiak, who described the fund as "an open end perpetual life, core plus private real estate investment focus." Kubiak said the strategy has been overweight to Sunbelt markets and residential/industrial sectors and stressed that stronger operating income and a conservative balance of fixed‑rate debt had supported resilience even as some valuations were written down; he noted recent capital inflows and roughly $300,000,000 of recent acquisition activity.

JPMorgan: Jeff Fox reminded the committee of his long relationship with Mississippi PERS, "I've been here, next month, 24 years," and introduced portfolio staff. JPMorgan's presentation focused on underperformance driven by allocation and higher leverage relative to peers, large recent disposition activity and a plan to continue reducing office and retail exposures and to increase industrial and residential weightings. The firm cited active redemption and contribution queues and said dispositions and a fee credit program are being used to manage liquidity.

Principal: Greg Pittenger (Principal Asset Management) said the Principal core account sits at just under $12 billion across ~150 properties, with 93% occupancy. He reported a contribution queue of about $612,000,000 and a withdrawal queue of about $1,400,000,000 at the end of the first quarter, explained why the team paused capital calls during repricing and said Principal has shifted to a more balanced posture of selective acquisitions while continuing disposals of non‑strategic office assets.

UBS / Trumbull / TPG: Presenters including Paul Kenny and TPG staff described Trumbull and TPG funds as emphasizing multifamily and industrial, keeping leverage decisions tactical, and managing redemption pools through a mixture of dispositions, credit facilities and staged payouts. TPG noted higher-than‑benchmark leverage amplified recent negative returns but argued that portfolios remain well leased and positioned for recovery when interest‑rate and capital markets normalize.

Across presentations managers repeatedly flagged three themes: (1) valuations have been driven down mainly by higher cost of capital and, in some cases, active marking to market by valuation teams; (2) office remains the weakest sector while industrial and residential have stronger fundamentals; and (3) liquidity management (redemption queues, scheduled payouts, fee credits and selective sales) is a central operating task now.

Board members pressed managers on valuation methodology, the role of leverage in performance, and the mechanics of using sale proceeds to service redemption pools. Managers responded with specific programs (fee credits, staged redemptions, targeted sales) and with explanations of why their valuation teams had taken the positions they had. The meeting record contains multiple quantitative references (redemption and contribution queues, recent disposition amounts, write‑down percentages) that staff can use for follow‑up reporting.

The committee took no formal votes on manager mandates during the presentations; subsequent actions or follow‑up reporting were not specified in the transcript.