Los Angeles Fire & Police commits $52.5 million, lowers assumed rate of return

Los Angeles Fire & Police Pension System in closed session committed up to $52.5 million to three private equity funds, according to a report to the board.

The $20.3 billion pension fund committed up to $25 million to Glendon Opportunities Fund II, a distressed fund managed by Glendon Capital Management. The pension fund has not invested with Glendon in the past.

The pension plan also committed up to $20 million to New Enterprise Associates 16, an early-stage venture capital fund. Los Angeles Fire & Police has invested in past New Enterprise Associates funds.

The board also committed $7.5 million to DEFY Partners I, the first fund by venture capital firm DEFY Partners, a new firm formed by Neil Sequeira, a former managing director at venture capital firm General Catalyst Partners, and Trae Vassallo, a former general partner at venture capital firm Kleiner Perkins Caufield & Byers. Both are managing directors at DEFY Partners, according to a firm filing with the Securities and Exchange Commission.

Separately, on June 1 the board lowered the pension plan's investment return assumption to 7.25% from 7.50%. Its actuary, Segal Consulting, recommended the change, noting that a 7% investment return assumption is becoming more common among California public retirement systems, a staff report to the board noted.