CalSTRS plans to issue an RFP for a real estate consultant, pending approval by the investment committee at its Dec. 4 meeting. The contract of Pension Consulting Alliance, the present consultant for the $91 billion California State Teachers Retirement System, Sacramento, expires April 30. Staff expects responses to be due in February, with a selection to be made in April. However, staff has split the roles of consulting and strategy from performance reporting to avoid potential conflicts of interest, although firms can bid on one or both roles.
Separately, because of the more aggressive moves CalSTRS has made with its real estate portfolio, fund officials may modify the plans NCREIF Property index real estate benchmark. Issues under consideration include: how much to boost the expected return, given the use of leverage; determining the return premium of joint ventures and high-risk pooled funds; separating staffs use of leverage from manager decisions; and creating custom benchmarks for each manager, based on their relative riskiness. Staff is expected to report back in March or April.