"The joint venture provides us greater capacity to expand our share of the most lucrative part of the industrial real estate business--the development and repositioning of corporate real estate assets," says First Industrial president and chief executive officer Mike Brennan.

Adds chief financial officer Michael Havala, "This venture enables us to leverage both our national platform and value-creation expertise to generate higher returns on invested capital."

The joint venture also has a $100-million credit line from JPMorgan Chase. First Industrial Realty Trust, which was advised by Secured Capital, LLC, will receive management and leasing fees as well as sales commissions. CB Richard Ellis Investors will advise CalSTRS. "First Industrial has a strong track record of creating value in the industrial real estate market and this venture allows us to tap into their expertise and infrastructure for the benefit of our members," says CalSTRS investment officer Hank Thomas, whose 755,000-member pension fund has a $125-billion portfolio.