Michigan Department of Treasury, Bureau of Investments, committed a total of $1.62 billion to 15 private investment strategies in the quarter ended March 31 on behalf of the $54.5 billion Michigan Retirement Systems, East Lansing.
Private equity received a total of $725 million in commitments, with $250 million going to Advent Global Private Equity VIII-B, managed by Advent International; and $200 million each to Berkshire Fund IX, managed by Berkshire Partners, and Green Equity Investors VII, managed by Leonard Green & Partners. The pension fund also committed $75 million to Vista Equity Partners, the Bureau of Investments reported in a quarterly investment report presented to the state's investment advisory committee during a June 16 meeting.
In venture capital, the BOI committed $38 million total to three Accel Partners funds — Accel Growth Fund IV, $22 million; Accel XIII, $10 million; and Accel Leaders Fund, $6 million. The growth and leaders funds will use a similar strategy to their companion fund, Accel XIII, but will invest in larger transactions with later-growth-stage companies.
The BOI earmarked a total of $310 million to real estate. The largest commitment was $200 million to Rialto Credit Partnership, managed by Rialto Capital Management, followed by $75 million to Apollo Asia Real Estate Fund, managed by Apollo Global Management; $20 million to TSP Spartan C-1, a co-investment managed by Transwestern Strategic Partners; and $15 million to Invesco Mortgage Recovery Feeder Coinvest Spiga, managed by Invesco Advisers.
Real-return and opportunistic commitments totaled $545 million, including the $250 million previously disclosed that was committed to SJC Direct Lending Fund III, managed by Czech Asset Management. HPS Red Cedar Fund, a separate account managed by Highbridge Principal Strategies, also received a $250 million commitment. Warwick (SMRS) Co-Invest, a separate account co-investment managed by Warwick Energy Group received $25 million, and Specialty Equity Strategy, a separate account with co-investment opportunities managed by J.P. Morgan Asset Management, received $20 million.
Separately, the BOI reported to the investment advisory committee that annualized returns of the state's largest defined benefit plan — the $42.3 billion Michigan Public School Employees' Retirement System — lagged those of its policy return for periods ended March 31: one year, 1.4% (benchmark, 2.2%); three years, 8.6% (8.7%); five years, 8.2% (8.4%); 10 years, 6.2% (6.3%).
MPSERS' returns did, however, exceed the annualized peer median returns of the State Street universe of U.S. public pension funds for the same periods: one year, zero; three years, 6.7%; five years, 7%; 10 years, 5.6%.