Lawrence Schloss on Wednesday announced his resignation as chief investment officer for the $145 billion New York City Retirement Systems.
Mr. Schloss, deputy comptroller for pensions, will become president of the Angelo, Gordon & Co., a manager specializing in private equity, real estate and credit.
The position is new. Mr. Schloss is leaving the New York City post on Oct. 18 and will join Angelo Gordon on Nov. 11 as a partner and member of the firm's 10-person executive committee.
In a news release, New York City Comptroller John Liu said Seema Hingorani would be the interim chief investment officer. Ms. Hingorani has been director of public equities and hedge funds in the comptroller's office.
In an interview, Mr. Schloss, who joined the comptroller's office in January 2010, said the nearly four years in the public sector gave him a better appreciation of the role of pensions in peoples' lives. “It was a spectacularly great opportunity,” said Mr. Schloss, who had been chairman, chief executive and co-founder of private equity firm Diamond Castle. “It's really interesting. I'm surprised more people don't do it.”
However, Mr. Schloss noted there was a built-in time limit on his job. “I was appointed by an elected official whose term expires Dec. 31,” he said, referring to Mr. Liu, who ran unsuccessfully this fall in the Democratic primary for mayor of New York City. Given the political reality, Mr. Schloss added, he had to achieve as much as possible within the allotted time. “You can't get distracted,” he said.
According to Mr. Liu's news release, the city pension system — which comprises five pension funds — achieved an annualized rate of return of 11.9% for the three full fiscal years ended in June 30.
The release said the New York City funds had a 10-year return of 2.8% when Mr. Schloss was hired. Less than four years later, the 10-year annualized return has increased to 7.6% vs. its assumed actuarial interest rate of 7%.
“During Larry's tenure as chief investment officer, the city's pension funds grew by $45 billion, to $145 billion, the largest increase recorded by any NYC CIO ever,” Mr. Liu's news release said.
Mr. Liu is trustee of the New York City pension funds.
John Angelo, co-founder of Angelo Gordon, said in an interview that Mr. Schloss initially will help the firm in marketing, especially outside the U.S. “Ninety-two percent of $25 billion comes from the U.S., and that's too high,” said Mr. Angelo, referring to the firm's assets under management. An early effort will be seeking to expand its business in Asia and the Middle East, he said.
“We've known him for a long time,” Mr. Angelo said. “We hope he can take us to the next level.”