(updated)
Los Angeles City Employees’ Retirement System adopted suballocation targets for its new 10% real assets and 5% credit opportunities allocations, according to recently released minutes from the system’s Feb. 14 meeting, sent by Linda Aparicio, spokeswoman for the $10.2 billion retirement system.
Within the 10% real asset allocation, the suballocation targets are private real estate, 50%; inflation-linked bonds, 30%; commodities and natural resources, 10%; multiasset real asset/return strategies, 5%; real estate investment trusts, 5%; timberland and farmland, zero, with a target range of zero to 3%; master limited partnerships, zero, with a target range of zero to 2%; infrastructure, zero, with a target range of zero to 2%; oil and gas partnerships, zero, with a target range of zero to 2%.
Within the 5% credit opportunities asset class, the suballocation targets are global high yield, 55%; emerging markets debt, 35%; leveraged loans, 10%; and distressed debt and opportunistic bonds, zero, with a target range of zero to 5%.
Separately, the board renewed Boston Co. Asset Management’s contract to manage a $169.4 million active emerging markets equity portfolio. The firm’s three-year contract was set to expire Feb. 23.
Also, the board adopted its first formal emerging manager investment policy, which states that system officials will consider emerging investment managers as part of any manager search. It also adopted an “aspirational goal to double the investment commitment (to emerging managers) within the next twelve months,” according to meeting minutes.
Further information was not available by press time.
Separately, the board is expected to decide whether to issue an RFP for a manager that can manage multiple passive investment strategies for transition purposes.
Also, the board is expected to decide whether to allow the contract of AllianceBernstein to expire on March 31 and move its $399 million in domestic large-cap growth equity to the BlackRock S&P 500 Enhanced Index Fund temporarily until a replacement strategy is identified. Staff made the recommendation, in part due to significant organizational changes at AllianceBernstein including the termination of the strategy’s five-member management team.
