CalSTRS plans to search for two consultants, one for real estate and the other for alternative investments. The $157.8 billion California State Teachers' Retirement System, Sacramento, has $12.8 billion invested in real estate and $9.4 billion in alternatives.
The contracts of current real estate consultant Pension Consulting Alliance and alternatives consultant McKinsey each expire June 30. CalSTRS' staff wants to extend the PCA contract by six months. Both new contracts would be for three years with two optional one-year extensions, starting July 1 for the alternatives consultant and during the fourth quarter for the real estate consultant. Real estate consultant finalists are slated to be interviewed in September, while alternatives consultant finalists will be tentatively scheduled for interviewed May 3.
During the past three years, PCA charged an average of $371,000 per year for its services. McKinsey has charged an average of $360,000 a year for its services over the past five years.
The CalSTRS board will consider authorizing the searches at its Feb. 8 meeting. Both firms can rebid.