Montgomery County Employees' Retirement System, Rockville, Md., is reviewing the structure of its U.S. equity portfolio, the blend of active vs. passive managers and amounts allocated, said Julie Dellinger, executive director. The $1.3 billion fund's investment committee will discuss the review next month and make recommendations at the board's September meeting.
The system also will revisit its real estate strategy at the end of the year when Wilshire Associates conducts an asset-liability study that could lead to a review of its asset allocation. The fund also is developing a derivatives policy that it hopes to adopt in September. It then will examine an automatic rebalancing process that might include derivatives.
Ennis Knupp & Associates dropped its 16-year program allowing pension funds to pay for consulting services through soft-dollar brokerage. CEO Richard M. Ennis said the firm ``has some growing concern whether clients are getting best execution through this arrangement.'' Ennis Knupp used Bear Stearns Securities for its program since its inception 16 years ago.
Mr. Ennis said the program accounted for 10% of its billings. Ennis Knupp will still accept soft-dollar payments from clients for its consulting fees, but only through arrangements made by the pension funds with their brokerage firms; the consultant won't be involved.
Pension funds and their real estate money managers, REITs, opportunistic funds and foreign investors are expected to be bidders for the $5 billion property portfolio of Leona Helmsley. Ms. Helmsley announced today she will sell a portion of her portfolio, including more than 25 million square feet of office space, in excess of 20,000 apartments, more than 7,500 hotel rooms, about 50 shopping centers and more than 8 million square feet of warehouse space. Eastdil Realty is the exclusive adviser and sales representative.
Public School Teachers' Pension & Retirement Fund of Chicago will allocate 2% of fund assets to public REITs, boosting the overall allocation to real estate to 7% from 5% of total assets. Trustees will discuss hiring REIT managers already interviewed by the fund. Consultant Mercer will make additional recommendations at the Aug. 22 meeting.
Worcester (Mass.) Retirement System may reduce its number of bond managers to three from four, said James A. DelSignore, city auditor and trustee. The $233 million system would keep the same 32% bond allocation. The managers are: Putnam, for international; Loomis Sayles, high yield and conservative; State Street Research, mainly Treasuries; Babson, mainly mortgage-backed securities and corporates. A decision is expected later this summer. Dahab is assisting.
CORRECTION: The California Public Employees' Retirement System CEO's salary, with incentive, could rise to $143,000 to $182,000. The new base salary is $110,000 to $140,000, vs. $100,000 to $110,000 previously. Yesterday's P&I Daily reported incorrect data.
