South Carolina Retirement System Investment Commission approved a total of $1.2 billion of investments and commitments for the $28 billion South Carolina Retirement Systems, which it oversees, at a meeting Thursday in Columbia.
The RSIC’s largest commitment was a $400 million commitment to a senior direct lending strategy that will be managed in a separate account by Ares Capital from the pension fund’s $1.7 billion private debt portfolio, according to a meeting webcast.
Golub Capital received an additional commitment of $300 million for the existing senior direct lending strategy it manages for the pension fund, bringing the total for the allocation to $400 million.
RSIC commissioners also approved an initial investment of $350 million to a U.S. high-yield bond strategy separate account managed by Barings. The RSIC allocated a total of 3% of plan assets, about $840 million in current dollars, to the new high-yield strategy.
In real estate, $150 million was committed to value-added real estate fund Greystar Equity Partners IX, managed by Greystar Real Estate Partners. The fund will focus on investment in U.S. multifamily properties, according to the webcast and meeting documents.
The board also received plan asset and performance information as of June 30, the end of its fiscal year, from its new chief investment officer, Geoffrey Berg, and Aon Hewitt Investment Consulting.
The pension fund returned a net -0.39% in the fiscal year ended June 30, trailing its benchmark return of 0.82%.
Aon Hewitt said in its report that the pension fund’s underperformance for the fiscal year ended June 30 relative to its policy benchmark was driven by returns within the public global equity, global tactical asset allocation, mixed credit and low-beta hedge fund portfolios.
For longer periods, the pension fund’s annualized returns were three years, 5.28% (5.25% benchmark); five years, 5.19% (4.86%); and 10 years, 4.49% (3.99%).
Assets of the South Carolina Retirement Systems declined 4.15% from $29 billion in the 12 months ended June 30. The decline over the year was due to investment underperformance of $152 million and net benefit payments of $1.06 billion, according to the investment staff’s performance report to the RSIC.