Skip to main content
MENU
Subscribe
  • Sign Up Free
  • LOGIN
  • Subscribe
  • Topics
    • Alternatives
    • Artificial Intelligence
    • Consultants
    • Defined Contribution
    • ESG
    • ETFs
    • Face to Face
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Partner Content
    • Pension Funds
    • Private Equity
    • Real Estate
    • Regulation
    • SECURE 2.0
    • Special Reports
    • Washington
    • White Papers
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • WPS Innovation Awards
    • Influential Women in Institutional Investing 2023
    • Eddy Awards
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • ESG Sustainability - Gaining Momentum
    • ESG Investing | Industry Brief
    • Innovation in ESG Investing
    • 2023 ESG Investing Conference
    • ESG Rated ETFs
    • Divestment Database
  • Defined Contribution
    • Latest DC News
    • The Plan Sponsor's Guide to Retirement Income
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • DC Plan Design: Improving Participant Outcomes
    • 2023 Defined Contribution East Conference
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Research Center
    • The P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
Breadcrumb
  1. Home
  2. ALTERNATIVES
November 14, 2016 12:00 AM

CalPERS mulls going direct in private equity

  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print
    CalPERS CIO Theodore Eliopoulos

    CalPERS Chief Investment Officer Theodore Eliopoulos asked the retirement system's senior private equity staff Monday to explore options to change the $299.5 billion pension fund's private equity program, including cutting out general partners and making private equity investments directly.

    Mr. Eliopoulos said he was concerned about the small number of top-performing private equity managers, who because of their performance have been able to maintain high fees and are oversubscribed. He said the California Public Employees' Retirement System, Sacramento, might have to come up with alternatives to the general partner/limited partner fund structure.

    “It's not a game of chicken,” Mr. Eliopoulos said in his remarks at the pension fund's investment committee meeting in Sacramento, saying CalPERS is not attacking general partners, but rather putting its focus on making its private equity program as cost-effective as possible.

    Other options that will be explored include increasing the number of co-investments and increasing the number of separate accounts with general partners, Mr. Eliopoulos said.

    In an interview during a break at the meeting, Mr. Eliopoulos stressed that no decisions will be made immediately; a review will take at least several years.

    No public pension fund in the U.S. runs its own direct private equity program, but large plans in Canada do.

    CalPERS' private equity portfolio is $26.4 billion, with $17.7 billion of that in private equity funds, $3.8 billion in funds of funds, $2.9 billion in separate accounts and $1.8 billion co-investments. The remainder is in currency and distributed securities.

    The issue of how much CalPERS pays private equity managers has been a controversy since CalPERS disclosed back in 2015 that it did not know how much it was paying in private equity performance fees.

    That disclosure prompted a state law requiring disclosure of fees. Statistics presented at Monday's meeting show CalPERS paid $206.5 million in management fees and $539 million in performance fees to general partners during the fiscal year ended June 30.

    CalPERS, which has more than 100 private equity partners, is engaged in a multiyear process to reduce the number of managers to 30.

    Private equity is CalPERS' best performing long-term asset class, with a net annualized return of 10% for the three years ended June 30; 9.7% for five years and 10.2% for 10 years, compared to the benchmark's 10.8% 10.6% 12.7%, respectively.

    Related Articles
    Private equity the best performer, CalPERS' Eliopoulos says
    CalPERS reports seven times more in net gains vs. carried interest over 25 years
    CalPERS among large investors endorsing private equity fee reporting template
    Outsized demand for quality private equity funds hampering CalPERS' quest to lo…
    Election not expected to slow move to alts
    CalPERS studies ways to keep private equity afloat
    CalPERS turns to Meketa as private equity consultant after abrupt PCA resignati…
    Canadian plans answer staff dilemma
    Recommended for You
    dollar_bills_graph_1550-main_i.jpg
    Global insurers diving deeper into private markets, BlackRock survey finds
    100_dollar_bills_i.jpg
    Centerbridge, Wells Fargo to launch direct lending fund for middle market
    LP interest in private markets grows despite recession fears – GSAM survey
    LP interest in private markets grows despite recession fears – GSAM survey
    DC Plan Design: Improving Participant Outcomes
    Sponsored Content: DC Plan Design: Improving Participant Outcomes
    Sponsored
    White Papers
    2023 Hot Topics in Retirement and Financial Wellbeing
    Bonds: Shaken, but Not Stirred
    A Study of Allocations to Alternative Investments by Institutions and Financial…
    Unlocking Hidden Value in Japan
    The Art of the Possible in Data Automation for Institutional Investors
    Parnassus View - Investing in AI: Transformative New Tech, Same Old Rules
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    December 12, 2022 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Custom Content
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Artificial Intelligence
      • Consultants
      • Defined Contribution
      • ESG
      • ETFs
      • Face to Face
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Partner Content
      • Pension Funds
      • Private Equity
      • Real Estate
      • Regulation
      • SECURE 2.0
      • Special Reports
      • Washington
      • White Papers
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • WPS Innovation Awards
      • Influential Women in Institutional Investing 2023
      • Eddy Awards
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • ESG Sustainability - Gaining Momentum
      • ESG Investing | Industry Brief
      • Innovation in ESG Investing
      • 2023 ESG Investing Conference
      • ESG Rated ETFs
      • Divestment Database
    • Defined Contribution
      • Latest DC News
      • The Plan Sponsor's Guide to Retirement Income
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • DC Plan Design: Improving Participant Outcomes
      • 2023 Defined Contribution East Conference
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Research Center
      • The P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
    • Careers
    • Events
      • View All Conferences
      • View All Webinars