Expansion of Alternative Investment Platform Continues
NEW YORK, August 4, 2015 – TIAA-CREF, a leading financial services provider, today announced the close of TIAA-CREF Global Agriculture II LLC (“TCGA II”), its second global agriculture investment partnership. The fund closed with $3 billion in commitments, exceeding its initial fundraising target of $2.5 billion.
The new partnership, which will invest in high-quality farmland assets across numerous geographies spanning North America, South America and Australia, has capital commitments from several U.S. and international institutional investors, with numerous return commitments from the firm’s first farmland investment company, TIAA-CREF Global Agriculture I LLC (“TCGA I”). TCGA II has 20 investors, including AP2, Cummins UK Pension Plan Trustee Ltd., Environment Agency Pension Fund, Greater Manchester Pension Fund, New Mexico State Investment Council and the TIAA general account.
“With its low correlation to traditional asset classes like stocks and bonds, farmland offers excellent portfolio diversification benefits for investors and a hedge against inflation,” said Jose Minaya, senior managing director and Head of Private Markets Asset Management at TIAA-CREF Asset Management. “The macroeconomic fundamentals for investing in farmland are very positive and we view the launch of this new strategy as a testament to the ongoing potential and attractiveness of this asset class.”
The new fund will benefit from the local expertise of leading farmland asset managers, Westchester Group Investment Management (“Westchester”), a TIAA-CREF majority-owned subsidiary.“As a result of our work on behalf of institutional investors in the farmland asset class for over 25 years, we’ve developed a disciplined approach to managing these assets in a way that maximizes efficiencies and investment potential,” said Randall Pope, president and CEO of Westchester Group.
More than 80 seasoned agriculture professionals will manage the portfolio’s assets in each target region while supporting the strategy’s acquisition efforts.
“Our world-class global agriculture platform provides unique access to an extended network of experienced, dedicated agriculture and investment professionals located within regions targeted by the portfolio,” said Justin “Biff” Ourso, senior director and agriculture portfolio manager, TIAA-CREF Asset Management. “We are excited to bring the benefits of this approach to our investors through this new strategy and look forward to continuing our commitment to this asset class for years to come.”
The launch of TCGA II follows on the success of TCGA I which began investing capital in April 2011 and closed in May 2012 with $2 billion in commitments, exceeding its initial target of $1.5 billion.
“We are grateful for the support of our investors, who share our commitment to long-term, sustainable asset management,” said John Panagakis, Head of Asset Management Business Development for TIAA-CREF Asset Management. “Real assets offer numerous benefits and we strive to provide our investors with unique access to these asset classes.”
As a leading global farmland investor, TIAA-CREF is committed to innovation and sustainable asset management practices in the space. The firm currently manages approximately $8 billion in farmland assets and commitments around the world and has been investing in agriculture since 2007. In 2013, the firm launched the TIAA-CREF Center for Farmland Research at the University of Illinois to promote agriculture industry research and educational initiatives. TIAA-CREF is also a founding member of the Principles for Responsible Investment in Farmland, which was established by a group of international institutional investors in September 2011. These principles aim to improve sustainability, transparency and accountability of investments in farmland and are now incorporated as guidelines under the U.N. Principles for Responsible Investment of which TIAA is also a signatory.
Today’s announcement builds on the ongoing expansion of TIAA-CREF Asset Management’s $130 billion alternative asset management platform, which includes investments in real estate, farmland, timber, infrastructure, energy, private equity, private placements and commodities. Most recently, TIAA-CREF and GreenWood Resources (GWR), a global timber management company and TIAA-CREF subsidiary, announced the close of Global Timber Resources LLC (GTRCo), a $667 million global timber investment partnership.
The new investment partnership will be part of TIAA-CREF’s growing diversified global asset management platform, which offers a broad range of domestic and international equity, fixed income and alternative investment management strategies to individual and institutional investors. Today’s launch follows several successful transactions designed to further expand TIAA-CREF’s diversified global investment capabilities, which include the acquisition of the remaining ownership stake in TIAA Henderson Real Estate and the launch of middle market lending subsidiary, Churchill Asset Management in the second quarter of this year, as well as the acquisition of Nuveen Investments in 2014.
TIAA-CREF (www.tiaa-cref.org) is a national financial services organization with $869 billion in assets under management (as of 6/30/2015) and is the leading provider of retirement services in the academic, research, medical and cultural fields..