San Diego County Retirement Association will be looking at allocating private equity assets to distressed investments and intellectual property as part of an ongoing asset-liability study, Yagen Chen, investment officer for the $7 billion pension fund, said in a presentation last week to the board.
Fund officials are developing a private equity planning strategy that includes diversification by geography and strategies, including buyout, venture capital, distressed/special situation and opportunistic.
No immediate searches are planned.
Separately, officials are seeking to redeem the fund's $43 million investment in UBS O'Connor multistrategy hedge fund due to a change in investment strategy. The association will retain its $22 million investment in UBS O'Connor's market neutral long/short hedge fund. The association will be decoupling the active hedge fund strategies from their underlying market exposure. Lee Partridge, portfolio strategist at Integrity Capital, the system's new outsourced CIO firm, told the board the multistrategy fund has high exposure to high yield, particularly debt.
Separately, the board committed $25 million to Atlantic-Pacific Capital's private equity fund, Drug Royalty II, which will invest in pharmaceutical royalty streams and related assets.