Los Angeles City Employees' Retirement System will search for a master custodian early this month, according to a source close to the $9.1 billion system. As a matter of policy, the system's board conducts a search after six years with the same service provider. Incumbent Northern Trust's contract was set to expire July 31 but the board extended the contract for a year. Responses to the RFP are expected to be due Oct. 10, with a selection sometime after that.
University of Illinois, Urbana, will search in late September or early October for a customized hedge fund-of-funds provider to manage $90 million in a global long/short equity fund. Interested firms may contact the university's investment office at 217-244-8359, said Laura A. Vossman, director of foundation investments. In February, the asset allocation of the $580 million public equities portion of the $900 million endowment pool was changed to allow 10% to go into a few active concentrated U.S., non-U.S. and global hedge funds that will complement the fund's existing $27 million investment in two multistrategy funds of funds, said Ms. Vossman. The endowment reduced its U.S. equity allocation to 40% from 45% and increased non-U.S. equities to 20% from 15% to fund the move. Ms. Vossman said officials of the fund have not decided which of its two consultants — Callan Associates and Cambridge Associates — will handle the search.
University of Kentucky Endowment, Lexington, is planning to issue an RFP early next year for a $19 million private equity fund of funds, confirmed Susan Krauss, director of investments. The $750 million endowment has a total of $14 million investment in three private equity funds of funds managed by Commonfund: Capital Venture Partners VII, Capital International Partners V and Capital Private Equity Partners VI, according to Ms. Krauss. Funding might come from cash or rebalancing. Ennis Knupp, the fund's consultant, will assist in the search, Ms. Krauss said.
Plymouth (Mass.) County Retirement Association issued an RFI for value-added real estate managers, confirmed John McLellan, chairman of the board and treasurer. The $579 million plan has nine real estate managers, including a value-added manager, overseeing a total of $56.8 million, and plan officials do not want to terminate any of them, Mr. McLellan said. He could not identify the current value-added manager. The RFI is available on consultant Wainwright Investment Counsel's website at www.winvcounsel.com/rfp.html; Mr. McLellan said there is no deadline for submissions.
The New Mexico Public Employees' Retirement Association, Santa Fe, added new 5% allocations to both hedge funds and private equity and will restructure a portion of its $3.5 billion fixed-income portfolio, said Robert Gish, CIO of the $11.4 billion association. The board plans to discuss at its meeting Aug. 8 how it will search for new managers; Cliffwater is assisting. The board also is expected to decide whether to adopt a new 5% allocation to real estate, real assets or tangible assets such as commodities or timber. The hedge fund and private equity asset classes are new. Funding for hedge funds will come from fixed income, and the private equity allocation will come from equities. Specific manager reductions haven't been determined. Funding for a real estate, real assets or tangible assets allocation could also come from fixed income, although that has not yet been finalized.
Indiana Public Employees Retirement Fund, Indianapolis, is conducting an asset allocation study, said Shawn D. Wischmeier, CIO of the $14.5 billion fund. He said it is premature to comment on what asset classes the study might highlight. The fund's current target allocation is 45% domestic equities, 30% fixed income, 20% international equities and 5% alternatives, of which four percentage points are in private equity, venture capital and distressed debt and one percentage point is in real estate. Mercer Investment Consulting is assisting in the study, which Mr. Wischmeier expects to be presented to the fund's board before the end of the year. The fund also is searching for private equity managers to invest the $300 million to $400 million the fund plans to commit annually over the next four years, said Mr. Wischmeier. The fund needs to commit at that level each year to reach its target private equity allocation, accounting for maturing investments and other factors, he said. The fund has made a total of $425 million in private equity commitments, including $225 million this year, he said. "Private equity deals are being sourced by PERF staff and its consultant," Strategic Investment Solutions, Mr. Wischmeier said. "We're actively looking all the time." No RFP is being issued. Interested managers can contact PERF.
