CalPERS picked Hamilton Lane to manage a $500 million private equity fund that will invest in underserved urban and rural markets primarily in California. The commitment marks the second phase of the $217.5 billion California Public Employees' Retirement System's California Initiative Program, which started with a $475 million allocation in 2001.
Half of the $500 million will be earmarked for California-based private equity funds, and the other half for direct co-investments in California-based companies.
"By deploying capital in markets that have been overlooked by most mainstream sources of capital, the California Initiative Program has had a positive impact on the economic infrastructure of the state's underserved markets," said Charles Valdes, chairman of CalPERS' investment committee, Sacramento, in a news release. "We believe that this next phase of the California Initiative will attract new sources of capital to California companies, magnifying the impact of our investment."