Los Angeles City Employees' Retirement System's board is scheduled to decide Tuesday whether to launch a search for one or more active investment managers for a $65 million long-only U.S. or global real estate investment trust mandate, according to materials for the board's meeting.
Among other requirements, managers must agree to the FTSE NAREIT All Equity index (for U.S. REIT strategies) or the FTSE EPRA/NAREIT Developed index (for global REIT strategies) as the benchmark and agree to an objective of outperforming the benchmark by 100 basis points net of fees annualized over a full market cycle (normally three to five years).
Wilshire Associates, LACERS' general investment consultant, would assist.
The board will also consider hiring Principal Global Investors to manage $120 million in an active U.S. midcap core equity portfolio. LACERS launched the search in July. The other semifinalists were OakBrook Investments and Quantitative Management Associates.
Separately, the pension fund committed up to $10 million to small-cap buyout fund Vista Foundation Fund II. LACERS is already an investor in two other funds managed by Vista Equity Partners: Vista Equity Fund III and Vista Equity Fund IV.
At its Jan. 14 meeting, the board approved three-year contract renewals for Robert W. Baird & Co., which manages a $237 million active domestic fixed-income portfolio, and LM Capital Group, which runs a $269 million active domestic fixed-income portfolio, according to the meeting's minutes. Both contracts will now expire on Feb. 28, 2017.
The board also extended for one year Sit Investment Associates' mandate to manage a $189 million active domestic small-cap growth equity portfolio. Sit Investment's new contract will expire on Jan. 31, 2015.