Hawaii taps Oechsle for $600 million global bond allocation, commits $50 million to real estate

Updated with clarification

Hawaii Employees' Retirement System, Honolulu, allocated about $650 million total to two managers, said Vijoy Chattergy, chief investment officer.

The $16.3 billion pension fund hired Oechsle International Advisors to manage about $600 million in global fixed income. Funding will come from the elimination of international fixed-income strategies managed by Pacific Investment Management Co. and Oechsle and rebalancing elsewhere in the portfolio. As of June 30, the pension fund had $266 million and $426 million invested with PIMCO and Oeschle, respectively.

An RFP for the pension fund's first global intermediate fixed-income manager was issued in the spring. Both Oechsle and PIMCO were invited to rebid for the new allocation.

In real estate, the pension fund committed $50 million to Starwood Global Opportunity Fund XI, a real estate fund managed by Starwood Capital Group. It is a first-time relationship.

In other news, the pension fund put global credit manager Tortoise Credit Strategies on watch because of organizational changes. In October, it was announced that Lovell Minnick Partners, along with HarbourVest Partners, AlpInvest Partners and other limited partners, are purchasing a majority stake in Tortoise Investments, the parent company of Tortoise Credit Strategies. The pension fund originally hired Bradford & Marzec, which was acquired by Tortoise Credit Strategies in 2016.

The pension fund has $240 million invested with Bradford & Marzec.