Texas Teacher Retirement System, Austin, hired Tudor, Pickering, Holt & Co. as the $123.9 billion pension fund’s first specialist energy investment consultant, subject to successful contract negotiations.
TPH will provide technical expertise, research and due diligence on energy and natural resources principal investments, among other services, said Howard Goldman, a TRS spokesman, in an e-mail.
Trustees approved the recommendation of the pension fund’s investment management division to hire the new firm at a board meeting Thursday.
As of Dec. 31, the pension fund had $2.2 billion invested in energy and natural resources strategies. The target allocation for the asset class is 3%; as of Dec. 31, 1.7% of the total had been committed or invested, board materials said.
Investment staff told trustees in a memo: “As an energy-dedicated firm, TPH has established good relationships with the managers who may present principal investment opportunities.”
TRS has already had similar consulting-principal investment sourcing relationships since 2009 with LaSalle Investment Management for real assets and BlackRock for private equity, according to meeting materials.
Separately, general investment consultant Hewitt EnnisKnupp provided the pension fund’s benchmark-topping performance as of Dec. 31. For the quarter, the pension fund returned 4.2% (benchmark, 3.8%); one year, 12.1% (benchmark, 11%); three years, 9.1% (benchmark, 9%); five years, 12.4% (benchmark, 11.7%); and 10 years, 6.9% (benchmark, 6.7%). Multiyear returns are annualized.