Orange County Employees Retirement System, Santa Ana, Calif., made changes to its real estate, domestic fixed-income and international equity allocations at its Nov. 20 board meeting, said Keith Bozarth, CEO of the $6.6 billion fund.
The board approved a new strategic plan for its $533 million real estate portfolio that allocates up to 15% of the portfolio, with a target of 10%, to public real estate securities. Mr. Bozarth said there are no searches pending. Funding will come from uncommitted capital in the real estate portfolio or from reinvesting returns, according to a report by Callan Associates, the fund's real estate consultant. The portfolio's current targets are at least 70% core, up to 30% value-added and up to 15% high return.
Separately, Aberdeen Asset Management was hired to run $250 million in active domestic core-plus fixed income. The hiring was part of an allocation change to the fund's $1.25 billion U.S. fixed-income portfolio to 30% index, 53% core plus and 17% high yield, from 50% index, 33% core plus and 17% high yield. The board wanted more manager diversification in its core-plus portfolio, Mr. Bozarth said.
The board also hired active developed-market equity managers AQR Capital to handle $200 million and Mercator Asset to run $100 million portfolios. Funding comes from changing the $1.2 billion international equity portfolio to 60% active developed markets, 30% index and 10% small-cap equity, from 40% active developed equity, 50% index and 10% small-cap equity.