Florida State Board of Administration, Tallahassee, could make major allocations to alternative investments, including its first moves into hedge funds, infrastructure, timberland and corporate governance activism funds, among other investments.
The staff is reviewing proposals for a hedge fund consultant and expects to make a decision by the end of September. The consultant will help decide what hedge fund strategies to tap, and on direct investing or funds of funds. The board could decide on an allocation and the source of the funding by the end of the year, said Dennis D. MacKee, communications director of the FSBA, which has $102 billion in assets.
Fund officials also are in preliminary discussions with a half-dozen money managers to study infrastructure and could make a decision on allocations and managers late in the fourth quarter, Mr. MacKee said. The identities of the firms were not available. He characterized the discussions as “very preliminary.”
On timberland, the board is working with Townsend Group, its real estate consultant. The fund could decide on an allocation and any manager searches in the first quarter of 2010 at the latest, Mr. MacKee said.
The board also is negotiating with three managers of corporate governance activism funds, whose identities were unavailable. Wilshire Associates is assisting. A decision on allocations and managers could come in September or the fourth quarter, Mr. MacKee said.
On real estate debt, the board is considering a $600 million allocation, mostly to commercial properties. It also is considering investment in debtor-in-possession financing, though an allocation hasn't been set. No timetable was set for a decision.
The board's allocation target for the strategic investments portfolio ranges from zero to 10% and now is about 3.5%.