Philadelphia Public Employees Retirement System will invest $100 million a year in private equity over the next five years, said Christopher McDonough, investment officer-private equity. The $4.2 billion fund's target allocation is 11.2%; 5.5% has been invested to date. The current environment for private equity is competitive, Mr. McDonough said, but he is reasonably confident that the fund can invest the entire $100 million installment every year. Staff developed the plan and will search for managers with assistance from private equity investment consultant Franklin Park Associates.
The fund also plans to add real estate and hedge fund-of-funds investments and will probably use a similar time frame for filling these allocations, but Mr. McDonough did not have additional details. The real estate target is 5% of assets, and the hedge fund target is 6.18%.