Maine Public Employees Retirement System, Augusta, approved new long-term asset allocation targets that will more than double the $11 billion fund’s investments in alternative strategies over the next two to five years, said CIO Andrew Sawyer. The board approved a new 5% allocation in private equity, boosted its target allocation to real estate to 10% from 5% and raised its target allocation to infrastructure to 5% from 4%, Mr. Sawyer said in a telephone interview. The system’s board also allowed investing as much as an additional 10% of the overall portfolio in “opportunities as they present themselves,” such as special situation funds or other asset classes, he said.
Under the new allocation, domestic equities will fall to 30% from 41%, while non-U.S. equities will climb to 25% from 20%. The system’s 30% allocation to TIPS — part of a shift started five years earlier by then-CIO Rex Holsapple to an LDI-focused strategy — will give way to a 25% fixed-income target. Mr. Sawyer said the new allocation plan remains consistent with the LDI-focused philosophy, citing infrastructure’s hedging characteristics and a continued role in the portfolio for TIPS. Mr. Sawyer said market conditions will determine how quickly Maine moves to implement the new asset allocation targets.
