Illinois Teachers' Retirement System, Springfield, is searching for a specialist consultant for its $5.6 billion real estate portfolio.
The five-year contract with Callan Associates, the existing real estate consultant, expires Dec. 31. Callan is invited to rebid, said Dave Urbanek, TRS' spokesman. The new contract is for up to five years.
The RFP is available on the pension fund's website. Responses to the RFP are due by 2 p.m. on Sept. 26. Finalists will be presented at the pension fund's Dec. 12 meeting.
Separately, TRS hired Pacific Investment Management Co. as a strategic partner to manage $500 million in an opportunistic, customized special situations credit strategy.
The approach will invest in corporate and mortgage-related credit opportunities globally.
“This opportunistic strategy is flexible enough to take advantage of attractive investments wherever the investment team finds them,” Jennifer Bridwell, managing director and head of PIMCO's alternative products business, told trustees at a board meeting on Tuesday. The latest PIMCO investment brings the total PIMCO manages for the $45.3 billion pension fund to nearly $3 billion; PIMCO managed a total of $2.4 billion in eight different strategies for TRS as of June 30.
Trustees also gave the nod to commitments of up to $100 million each to private equity funds Baring Asia Private Equity Fund VI and NGP Natural Resources Fund XI, both follow-on funds from existing managers Baring Private Equity Asia and NGP Energy Capital Management.
TRS previously committed $80 million to Baring Asia Private Equity Fund V and $64 million to NGP Natural Resources Fund X and $25 million to NGP Natural Resources Annex A.
A $75 million commitment was awarded to another energy-focused private equity fund, Sheridan Production Partners III, TRS' first investment with Sheridan Production Partners Manager. The fund is part of the retirement system's real assets category, said Scottie Bevill, senior investment officer for fixed income.
Another change in the real assets category was the decision by trustees not to renew the contract of AQR Capital Management for investment in the firm's reinsurance strategy. AQR's two-year contract will expire in December, and Mr. Bevill told trustees that the pension fund's investment team lacks conviction that reinsurance strategies will do well in the near future. TRS had $40.9 million invested in the AQR reinsurance strategy as of June 30.
Also, R. Stanley Rupnik, chief investment officer, said the pension fund's preliminary returns for periods ended June 30, TRS' fiscal year-end, topped those of its custom policy benchmark in every period: quarter, 4.5% vs. 3.7%; one year, 18% vs. 16.4%; three years, 10.7% vs. 10.3%; five years, 13.9% vs. 12.5%; and 10 years, 7.8% vs. 7.4%.