Kansas Public Employees' Retirement System officials are gearing up for possible additions to its real estate portfolio, with the state Legislature considering a loosening of investment restrictions. A bill that would give the $8. 5 billion system more freedom to invest in real estate property and commingled funds has been passed by the state Senate and will be considered by the House after sessions resume April 29.
Trustees conducted a special meeting this month where they reaffirmed the fund's 10% target allocation to real estate and reacquainted themselves with the asset class, said Robert Woodard, CIO. The current restrictions effectively shut out Topeka-based KPERS from investing in real estate deals, he said. KPERS now has about 6% of assets in real estate with one-third of that in REITs, he said.
Also, an asset/liability study for the overall fund officially began this month. That should be wrapped up in July, he said. KPERS' current targets are: 28% U.S. equities, 15% non-U.S. equities, 26% U.S. bonds, 11% non-U.S. bonds, 10% real estate and 5% cash. Vanguard today will close its $10.2 billion Vanguard/PRIMECAP fund - one of its best-performing, actively managed equity funds - to all new investors. New and existing participants in defined contribution plans still will be permitted to invest in the fund in line with the requirements of their plan. Existing individual shareholders will be limited to investing not more than $25,000 per year in the fund.
Vanguard officials are closing the fund for the second time in its history to control future asset growth, Vanguard CEO Jack Brennan s aid in a statement. The fund was last closed for 18 months beginning March 7, 1995.
Bush Foundation, St. Paul, dropped Driehaus Capital Management as a manager for its $700 million fund, said Connie Thompson, CFO. It reallocated th e $25 million the firm ran in large-cap value equities among existing managers. She would not give any reason for the termination.
State Street Global is opening a San Francisco office and moving two staffers from Boston as part of the expansion - Christopher D'Amore and Brad Hilsabeck. Mr. D'Amore, formerly a senior portfolio manager of active global equity strategies, will head the office. Mr. Hilsabeck, who was vice president of sales and marketing in the retirement investment services division, will direct sales. Deseret Mutual Benefit Administration, Salt Lake City, is searching for a large-cap growth manager for its $1.8 billion pension fund, said Kent A. Misener, managing direc tor-investments.
It has one manager in mind as a candidate, which Mr. Misener didn't want to name. But the fund is looking at others as well and hopes to make a decision in a few months. The size of the assignment wasn't available.
San Jose (Calif.) Retirement Systems hired Eagle Asset Management to manage about $40 million in a small-cap growth equity assignment for the Federated City Employees Retirement System.
About $23 million of the assets going to Eagle had been managed by George D. Bjurman & Associates, which was terminated for performance reasons. Bjurman officials could not be reached for comment. The additional $17 million came from reducing an S&P 500 index portfolio; it w as moved to small-cap to bring the allocation closer to target. Callan assisted. San Jose's retirement assets total more than $900 million.
The American Stock Exchange, New York, hired Merrill Lynch as bundled provider for its $62 million 401(k) plan, said Victor Rodriguez, managing director of compensation and benefits. With the change, the Amex went to daily valuation for 25 fund options plus a self-directed brokerage option from monthly valuation for six funds. Buck was the plan's record keeper; Chase was trustee. Merrill beat out Vanguard and Fidelity for the assignment. The search was done in-house.
The Rohrer Corp., Wadsworth, Ohio, is adding a 401(k) plan to its $5million p rofit-sharing plan and selected KeyCorp to provide quasi-bundled services.
KeyCorp will provide four of seven investment options. Three options are managed by outside managers, said Joanne Rohrer, treasurer. KeyCorp has been the re cord keeper for the quarterly valued profit-sharing plan.
As of June 1, Rohrer employees will have full investment discretion over assets in the profit-sharing plan, as well as employee contributions in the 401(k) part of the plan.
Gayle McDade was hired as an investment manager to help oversee money manager relations for the pension fund of the City of Regina, Saskatchewan. She replaces Barb Miazga, who joined the Saskatchewan Wheat Pool pension fund, Regina.
Ms. McDade was manager-special investments at Crown Life Investment Management.