Parkway Properties Inc. has formed a $750 million fund with the Teacher Retirement System of Texas to acquire office buildings in at least 13 markets, including the Tampa Bay area.

Called Parkway Properties Office Fund II LP, it will be capitalized with about $375 million of equity capital and $375 million of non-recourse, fixed-rate first mortgage debt.

TRS will be a 70 percent investor and Parkway (NYSE: PKY) will be a 30 percent investor in the fund.

Other markets targeted include Jacksonville, Orlando, Fort Lauderdale, Chicago, Atlanta and Phoenix as well as Houston, Austin and San Antonio, Texas; Charlotte, N.C.; and Memphis and Nashville, Tenn.

Parkway will serve as the fund's general partner and will provide asset management, property management, and leasing and construction management services. Parkway will have four years to acquire properties and anticipates a 10-year life for the fund.

Steven G. Rogers, president and chief executive officer, said in a statement that the relationship with TRS strengthens the company's position as a well-established operator of office assets, not just an investor in such assets.

Parkway, a member of the S&P Small Cap 600 Index, is a self-administered real estate investment trust specializing in the operation, leasing, acquisition, and ownership of office properties. Based in Jackson, Miss., the company focuses on the Southeastern and Southwestern United States and Chicago.