Four of New York City's five public pension funds will add real estate and Treasury inflation-protected securities as new asset classes and increase their private equity allocation, the result of a new asset allocation policy, said city Comptroller William C. Thompson Jr.
The policy affects the $30.8 billion New York City Employees' Retirement and $23 billion teachers' retirement systems; and the $13.8 billion police and $4.7 billion fire pension funds. The policy, set after each fund conducted a separate study, will remain 70% equities and 30% fixed income, but with greater diversity within those categories. The 5% real estate allocation will be under equities, and the 3.5% TIPS allocation will be within fixed income. Private equity, which will be in the equity allocation, will increase to 5% from 2%. Real estate and private equity will be funded from U.S. equities, with TIPS funding coming from fixed income.