State of Michigan Retirement Systems, Lansing, made its first direct investment in a public REIT, buying a $35 million limited partnership interest Home Properties of New York. Home Properties is a $350 million company that specializes in apartments for older people. The $35 billion system's investment is in convertible debt, which if converted, would give the fund an 18% stake in Home Properties, said Philip Van Syckle, administrator for mortgage and real estate.
The security pays 9.25% for two years and 9% for three years. Michigan's previous REIT investments were made by purchasing shares in the open market.
Bank Julius Baer opened a Frankfurt-based money management arm to expand services to the evolving German pension fund market. The new subsidiary, Julius Baer Kapitalanage AG, specializes in management of securities for domestic and foreign institutional investors. It is headed by managing directors Harald Fuchs, responsible for administration and marketing, and Kurt Ochner, in charge of investment policy. Both had been at Julius Baer Capital GmbH, an internal advisory arm and have not been replaced.
California Public Employees' Retirement System's trustees have approved an incentive pay plan that could raise the total compensation for the fund's CIO to as high as $437,500.
The salary range for the CIO is now $185,000 to $250,000 with no incentive. Under the new plan, the CIO's pay could reach $323,750 to $437,500, including incentives. The plan for the CEO at Sacramento-based CalPERS calls for a base pay of $110,000 to $140,000 with an incentive bonus of $143,000 to $182,000.
California State Controller Kathleen Connell is calling the increases ``offensive.'' She said the plan could make the CalPERS CIO the highest paid public employee in the country. Chuck Valdes, chairman of the CalPERS investment committee, said the increases are needed to compete for talent in the private sector.
John Hancock Funds launched three bundled retirement plan packages for retail and service, manufacturing and industrial, and professional and technology companies. The programs provide communications and employee education and different plan design features targeted to each sector. The plans are designed for small and midsized companies and offer investment options, plan service and administration and telephone voice-response systems.
BlackRock Financial Management and Trepp & Co. formed a joint venture to provide commercial mortgage-backed securities data and analytics software. The venture, Trepp Management Services, will make the ``CMBS Deal Library'' available through subscription to traders and investors.
The software will contain updated loan and bond information and allow users to perform real estate specific market analysis. The CMBS Secondary System, which includes the CMBS Deal Library, will be shipped to subscribers in July.
3i PLC raised 537 million ECU ($605 million) for the first closing of its second fund to invest in unlisted companies in continental Europe. London-based 3i committed 50% of the assets raised for Eurofund II.Eight institutional investors from Britain, the United States and Asia provided the rest. 3i officials set a maximum fund size of 650 million ECU and expect that no more than 12 investors will be invested by the final closing.