HIRINGS:Arizona fund hires consultants for real estate, domestic and international alternatives

PHOENIX — Arizona Public Safety Personnel Retirement System committed up to $275 million to five private equity and real estate funds and hired three specialist consultants, pending contract negotiations, said James Hacking, executive director of the $7 billion system.

The funds committed $80 million to BlackRock Mortgage Investor Master Fund, a distressed debt fund; $75 million to Apollo Investment Fund VII, a private equity fund; $70 million to Apollo Value Enhancement Fund VII, a real estate fund; $25 million to Macquarie Infrastructure Partners II, a North American infrastructure fund; and $25 million to Macquarie European Infrastructure Fund III, a European infrastructure fund. No consultant was used.

Funding will come from reducing domestic equities; specifics have yet to be determined. The commitments are part of a larger effort to increase the system's real estate commitment to 6% and private equity to 5% from about 2% each. “These commitments will enable us to be much more diversified in those two spaces,” Mr. Hacking said.

Three specialist consultants also were hired to help staff perform due diligence in selecting new managers. The consultants and their specialties are ORG Portfolio Management, real estate; StepStone Group, domestic alternatives; and Capital Dynamics, international alternatives. Staff canvassed other pension systems for recommendations to find the consultants.

LITTLE ROCK, Ark. — Arkansas Teacher Retirement System awarded absolute-return fixed-income mandates of $200 million to $225 million each to Loomis Sayles and Putnam Investments. Wayne Greathouse, the $12 billion Little Rock-based system's director of public markets, said final guidelines will be worked out over the next few weeks. Funding will come from a bond index account managed by State Street Global Advisors. Mr. Greathouse said the hirings are in line with the fund's move to continue “broadening” its fixed-income allocations beyond core-plus mandates.

LONDON — Baring Asset Management hired GLG Partners to subadvise an $85 million Asian hedge fund of funds, effective April 1, according to a regulatory filing with the Irish Stock Exchange. GLG will replace Fauchier Partners, according to the filing.

Paul Graham, head of alternative funds business at Barings, declined to comment on the reason for the change.

Christopher Fawcett, chief executive officer and co-founder of Fauchier Partners, could not be reached by press time for comment.

SACRAMENTO, Calif. — California Public Employees' Retirement System hired Callan Associates and Mercer as general consultants to its supplemental income plans. The two firms will be on a preapproved list of consultants for the $1.1 billion SIP. At least one consultant on the list will help the $240.6 billion CalPERS create its own asset allocations funds.

TORONTO — Canada Pension Plan Investment Board and Ontario Teachers' Pension Plan, both of Toronto, each committed US$200 million to FountainVest, a new Hong Kong-based private equity fund, confirmed a CPPIB spokesman. The C$106 billion (US$105.3 billion) Ontario Teachers' plan made the investment through its C$17 billion Teachers' Private Capital private equity arm. The C$119.4 billion CPP Investment Board has C$20.2 billion in private investments. CPPIB will fund its commitment from cash; an Ontario Teachers spokeswoman could not be reached to discuss funding.

VANCOUVER, British Columbia — Genus Capital Management hired RBC Dexia Investor Services to provide global custody, fund valuations, shareholder services and investment finance for Genus' C$1.6 billion (US$1.6 billion) in separate accounts and pooled funds, confirmed Brad Bondy, Genus vice president of investment operations. RBC Dexia replaces Northern Trust as global custodian and Bear Stearns as prime broker.

REDDITCH, England — GKN Group Pension Scheme hired Cardano as manager of managers for £300 million ($597.3 million) in active equities, confirmed Phil Page, client manager at Cardano. The portfolio had been actively managed by another manager but was recently put into an index fund while the board decided on management options, Mr. Page said. He would not say who had managed the portfolio.

“Generating superior returns from equities is very important to the trustees,” John Hughes, chairman of trustees at GKN, said in a news release issued by Cardano. “We want an active approach to managing this specific part of our investments and decided that it makes sense to appoint a full-time professional team suitably motivated to deliver targeted results.” Mr. Hughes could not be reached for further comment.

HONOLULU — State of Hawaii Deferred Compensation Plan hired AllianceBernstein and Victory Capital to provide equity options for the state's $1.4 billion 457 plan.

The Alliance Bernstein International Value Collective Investment Trust fund, an international large-cap value equity fund, will be a new option for participants, said Cynthia Akiyoshi, personnel management specialist. The Victory Capital Institutional Diversified Stock fund, a domestic large-cap core equity fund, is replacing the Fidelity Growth & Income fund, which the board dropped for performance, Ms. Akiyoshi said. After the change, participants will have 16 options. Consultant Mercer assisted.

Fidelity spokeswoman Jennifer Engle said the company has confidence in Tim Cohen, portfolio manager of the Growth & Income fund. Mr. Cohen “can provide the fund with the best possible opportunity to attain strong, competitive long-term performance in the years ahead,” Ms. Engle said in an e-mail.

LAS VEGAS — International Brotherhood of Electrical Workers Local 357 hired New York Life Retirement Plan Services as bundled provider of its $215 million Taft-Hartley plan, said Sarah Lazarus, NYLIM spokeswoman. Consultant NEPC assisted. The previous provider was MassMutual Financial Group. “We are very pleased with the service we've received from New York Life and are looking forward to working with the team there going forward,” Max Carter, the union's assistant business manager, said in a New York Life news release. Neither Mr. Carter nor John S. Shanklin, consultant at NEPC, could be reached for further details.

LOS ANGELES — Los Angeles City Employees' Retirement System committed up to $20 million to Apollo Investment Fund VII, according to information provided by the $11.1 billion system. Hamilton Lane assisted.

PASADENA, Calif. — Los Angeles County Employees Retirement Association committed up to $10 million to Union Square Ventures 2008, said Christopher J. Wagner, senior investment officer of private equity for the $39.6 billion association.

Funding came from cash.

BATON ROUGE, La. — Teachers' Retirement System of Louisiana committed $50 million to the Walton Street Real Estate Fund VI. Hamilton Lane Advisors, the fund's private equity consultant, assisted, said Bob Leggett, chief investment officer of the $16 billion system.

COLUMBUS, Ohio — Ohio School Employees Retirement System committed up to $300 million to several hedge funds, all to receive up to $50 million each: Aristeia International, Bridgewater Pure Alpha I, Fore Convertible Offshore, Lydian Overseas Partners, PIMCO Absolute Return Strategy III Offshore and Stark Offshore Management's Shepherd Investments International.

The $11.6 billion fund also allocated up to $50 million to the Five Arrows Realty Securities V fund, managed by Rothschild Realty Managers; up to $40 million to Graham Partners III private equity fund; and up to $30 million to Swander Pace Capital's SPC Partners IV private equity fund.

Funding for all the commitments will come from cash, said spokeswoman Julie Graham-Price.

OKLAHOMA CITY — Oklahoma Police Pension and Retirement System hired Loomis Sayles to run about $70 million in active global fixed income, pending contract approval, said Bob Wallace, executive director. Funding comes from terminating Fischer Francis Trees & Watts, which ran an international government bond portfolio. The new strategy will include corporate and emerging market debt.

The move was made for diversification, Mr. Wallace said. Asset Consulting Group assisted the $1.8 billion plan.

OVERLAND PARK, Kan. — Overland Park Police Department Retirement Plan committed an estimated $2 million to $3 million to the Eaton Vance Tax Managed Emerging Markets Fund-I, a commingled fund, at a Feb. 20 board meeting, said Mike Russo, manager of the $46 million fund. The final amount, as well as the source of funding, will be determined at the board's next quarterly meeting, he said.

Dahab Associates assisted.

SACRAMENTO, Calif. — Sacramento County Employees' Retirement System hired active domestic equity managers Wells Capital Management to run $125 million in large-cap growth, and WEDGE Capital and Thompson, Siegel and Walmsley to each run $50 million in small-cap value, said Jeffrey States, chief investment officer at the $6 billion pension fund.

Independence Investments, which ran the large-cap growth portfolio, and TCW, which ran $100 million in small-cap value, were terminated for performance, he said. TCW spokesman Michael Utley declined to comment on client relationships.

Through a spokesman, Independence CEO Mark C. Lapman said: “Sacramento County Employees' Retirement has been a valued client. A decade ago, Independence was hired for a U.S. large-cap growth portfolio with a mandate to manage the money with a low tracking error to the Russell 1000 Growth benchmark, and we met that goal. We understand the system now seeks a more aggressive approach to managing that portfolio and we wish them well.''

CLAYTON, Mo. — St. Louis County Retirement Plan hired Western Asset Management to run $46 million in a core-plus fixed-income strategy, said Kirk McCarley, personnel and retirement director of the $460 million system.

The move was made to improve returns, he said. Funding comes from terminating Wellington Management, which ran the money in an active domestic intermediate bond strategy. Summit Strategies assisted in the search.

SAN ANTONIO — San Antonio Fire & Police Pension Fund hired Commonwealth Advisors as a mortgage-backed and asset-backed securities fund manager to run $30 million, according to recently released meeting minutes.

Funding comes from terminating Harris Associates, which ran $98.4 million in a commingled international equity account. The remainder of Harris' allocation was divided among existing managers LSV Asset Management and Julius Baer Investment Management, which received $25 million each, and cash. LSV has an international large-cap equity portfolio; Baer's portfolio was unknown. Warren Schott, chief investment officer of the $2.2 billion plan, could not be reached for comment.

Consulting Services Group, the plan's investment consultant, assisted. No RFP was issued.

COLUMBIA, S.C. — South Carolina Retirement System Investment Commission at its board meeting Feb. 21 made a €50 million ($73.7 million) commitment to the Bridgepoint Europe IV fund and a €35 million commitment to the Apax Europe VII fund, according to CIO Robert Borden. Also, $40 million was added to the TCW Special Mortgage Credits Fund; the board already has up to $100 million committed to the fund. The panel oversees $30 billion in retirement assets.

RICHMOND, Va. — Virginia Retirement System allocated $300 million to Bridgewater's Pure Alpha strategy, said VRS spokeswoman Jeanne Chenault. The $58.7 billion system also made private equity commitments of $136 million to Nordic Capital Fund VII and $45 million to AG Private Equity Partners IV LP, Ms. Chenault said.

Funding for all the new commitments is from cash, she said.