Tennessee Consolidated Retirement System, Nashville, hired Christofferson, Robb & Co. to run a $100 million strategic lending separate account portfolio, said Shelli King, spokeswoman for David H. Lillard Jr., Tennessee state treasurer who oversees the pension fund, in an e-mail.
The $44.4 billion pension fund also committed $100 million to Great Hill Equity Partners VI, a buyout fund managed by Great Hill Partners. It is the first time the pension fund has hired or committed to Christofferson Robb or Great Hill Partners.
Separately, the pension fund changed its target allocations following an asset allocation review, effective Jan. 1. In a departure from the plan's previous policy, the pension fund is establishing an interim target to be reached within three to five years in order to transition to long-term strategic targets.
The biggest change is in strategic lending and private equity, whose interim targets will be 7% each and strategic targets will be 10%. The current targets for the two asset classes are 5% and 3%, respectively. Real estate will also increase, with an interim and strategic target of 10%, up from the current 7%.
Inflation-indexed bonds, which currently has a 4% target, is being dropped. Domestic equity, which currently has a target of 33%, is dropping to 31% for both its interim and strategic targets.
International developed equity will remain at 13% for the interim target but drop to 12% for the strategic target, and emerging markets equity, which has a current target of 5%, will drop to 4% for both the interim and strategic targets. Canadian equity, which has a current target of 4%, will drop to 2% for both the interim and strategic targets.
Domestic fixed income will remain at 25% for the interim target and drop to 20% for the strategic target. The target to cash and cash equivalents will remain unchanged at 1%.
The actual allocation as of Sept. 30 was 33.5% domestic equity, 25.4% domestic fixed income, 13.6% international developed markets equity, 7.8% real estate, 4.7% emerging markets equity, 4% inflation indexed bonds, 3.8% strategic lending, 3.5% private equity, 2.9% Canadian equity and the rest in cash and cash equivalents.
Specific information on the implementation of the changes was not available by press time.
Investment consultant Verus Advisory assisted.