Texas Municipal Retirement System, Austin, hired ORG Portfolio Management as the $16.7 billion system’s real estate consultant, confirmed spokesman Bill Wallace.
The system is adding real estate as a new asset class and expects to allocate 10% of total assets to the portfolio, Mr. Wallace said. The system’s board hopes to begin awarding mandates by the end of the year.
The system is about two years into a diversification plan to move the system away from its almost 100% bond allocation, Mr. Wallace said. As of Aug. 31 2009, the system had 84% in fixed income and 8% each in international equities and domestic equities.
A new investment policy, adopted in June, sets target allocations of 35% in fixed income; 20% each in domestic and international equities; 10% in real estate; and 5% each in absolute return, real return and private equity.
The diversification plan was expected to be implemented by late 2013, but Mr. Wallace said the plan was delayed due to volatility in the markets and the departure of the system’s executive director, Eric Henry, who left in August to become CIO of the UAW VEBA.