Illinois Teachers' Retirement System, Springfield, is conducting an asset allocation review, said Stan Rupnik, CIO. It's too early to predict what changes will be recommended, but they are more likely to focus on reallocations within styles of public equities than alternative investments, which were recently readjusted, Mr. Rupnik said. Trustees increased the plan's alternatives targets in 2002, to 14% for real estate, from 11%, and to 6% for private equity, from 3%.
Because the plan has so much money to put to work in capacity-constrained alternative asset classes, at the end of 2004, the board established interim targets for 2005 and tactical plans for accomplishing the additional investments. The goal is to increase real estate investment to 12% this year and to increase private equity investment to 4%. While staff and the consultant are confident they can invest between $400 million and $600 million in private equity this year, Mr. Rupnik said the tactical plan doesn't include a specific dollar amount for real estate because the low number of deals and high valuations limit the fund's ability to find good investments.
Staff and consultant Callan Associates review the $33.6 billion pension plan in detail every two to three years, and the last review was about three years ago. The timetable for completion of the review was not available.