Illinois State Board of Investment, Chicago, plans to issue an RFP in a search for an investment consultant for the $4 billion Illinois State Employees’ 457 Deferred Compensation Plan, said William R. Atwood, executive director.
ISBI, which oversees the plan’s assets, will post the RFP on its website Jan. 25, Mr. Atwood said.
Marquette Associates resigned as the 457 plan’s investment consultant after ISBI hired Meketa Investment Group in October as investment consultant for the $15 billion in defined benefit assets the board oversees, replacing Marquette, Mr. Atwood said.
Marquette and Meketa are welcome to bid on the 457 plan RFP, Mr. Atwood said. The ISBI board expects to make a decision before the end of June.
Also, ISBI committed $50 million each to Westbrook Real Estate Fund X, managed by Westbrook Partners, and Madison International Real Estate Liquidity Fund VI, managed by Madison International Realty. Courtland Partners, ISBI’s real estate consultant, assisted in the searches.
Separately, ISBI staff plans to seek board approval in March to conduct an asset allocation study of the defined benefit assets, assisted by Meketa.
“We have not constrained Meketa,” Mr. Atwood said. “They are free to look at all the options. That is part of their value proposition: What should we be looking at?”
Until completion of the proposed asset allocation study, at Meketa’s recommendation, ISBI postponed a decision on hiring a manager for a $489.3 million World Government Bond ex-U.S. index fund and taking any action on Segall Bryant & Hamill, which was placed on watch last September for performance, Mr. Atwood said.
ISBI issued the passive manager RFP in October; no finalists have been selected, Mr. Atwood said.
Funding will come from terminating Wellington Management, which manages the $489.3 million in an active international aggregate bond portfolio. Wellington continues to manage the portfolio until ISBI hires a manager.
Segall Bryant & Hamill manages $250 million in active small-cap core equities. Philip L. Hildebrandt, the firm’s CEO, declined to comment.
In addition, ISBI put on hold a decision on hiring a target-date fund manager until after the hiring of a defined contribution investment consultant, Mr. Atwood said.
ISBI issued an RFP in October for a target-date fund manager as a result of target-date fund assets increasing to 56% from 11.9% of the plan’s assets, driven by a re-enrollment of all participants in April. Incumbent T. Rowe Price Group can rebid. Finalists have not been selected, Mr. Atwood said.