Using operating companies under ERISA

Article Abstract:

The enactment of the Employee Retirement Income Security Act (ERISA) in 1974 has resulted in costly and problematic transaction and fiduciary rules governing investments. Trends towards investments by pension plans in real estate investment trusts (REITs) and real estate operating companies have been marked since about 1996 because of the law. A suggested venture capital operating company/REIT structure will furnish a relatively simple manner for investment advisers to form open- and close-ended co-mingled and single-client funds while avoiding costly and problematic ERISA rules.

Methods, Institutional investments

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Can pension assets be invested in real estate prudently without diversification?

Article Abstract:

Contemporary portfolio theory calls for diversification to reduce risks and to maximize investment returns. Investment advisers should therefore choose diversified investment portfolios that include real estate and whose risks are not complementary and partially offset each other. The circumstances under which those responsible for investing pension fund assets can invest in real estate without diversification under the Employee Retirement Income Security Act of 1974 is shown in an analysis of the legal case Reich versus King.

Real estate investment, Real estate investments, Investment advisers

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Obligations of plan fiduciaries: economically targeted real estate investments

Article Abstract:

A variety of rules and case laws that regulate investments made by plan fiduciaries in economically targeted investments (ETI) have been developed. These laws were developed to prevent ETI investments from jeopardizing pension funds. Some of these laws include the Employee Retirement Income Security Act, the Pension Protection Act, the Dept. of Labor's Interpretive Bulletin 94-1 and the case 'DeArment v. Rylands, et al.'

Socially responsible investments

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