Washington State Investment Board, Olympia, will shift $2 billion in assets into real estate and alternative investments under a new asset allocation plan, said Gary Bruebaker, chief investment officer. The $40 billion plan will boost real estate to 12% of total assets from 9% and alternative investments to 17% from 15%. It will funnel money to an existing stable of 25 real estate partnerships over the next two to three years.
Next month, staff and consultant Pacific Corporate Group will develop an alternative investments plan, which will be reviewed at the boards Jan. 3 private markets committee meeting. Most new money likely will be reinvested with the boards existing partners, but officials also will consider various opportunities, including hedge funds.
The board will fund the allocation shift by reducing its domestic equity allocation, which is passively managed by Barclays Global Investors, to 31% of assets from 36%. Fixed income will remain at 25% and international equity, 15%. Watson Wyatt Worldwide assisted.