Alameda County Employees' Retirement System, Oakland, Calif., plans to commit a total of $490 million to seven private credit funds through 2022, recently released investment committee meeting materials show.
The $7.6 billion pension fund's plan follows the creation of the new 4% target allocation to private credit, resulting from an asset-liability study.
The pension fund plans to reach the target by 2023. Investment consultant Verus Advisory, in a presentation at the pension fund's investment committee meeting, reported the pension fund will need to make $490 million in commitments to a total of seven private credit funds by year-end 2022.
The pension fund will commit a projected total of $100 million before year-end 2019, according to the plan, with $130 million committed each in 2020, 2021 and 2022.
The pension fund added the new target within its overall growth portfolio, which saw its target decrease slightly to 66% from 66.8% of the total fund.
Other changes within the growth portfolio were reductions to targets to domestic large-cap equities to 22.4% from 25% of the total fund, international developed equities to 17% from 18%, private equity to 10.5% from 11.3%, domestic small-cap equities to 2.5% from 3%.
Targets to emerging markets equities and international small-cap equities remain the same at 5% and 3%, respectively. The target to high-yield fixed income was increased to 1.6% from 1.5%.
Within the diversifying portfolio, which saw its overall target rise to 23.4% from 22.6% of the total fund, the target to core fixed income rose to 11.4% from 11.3%, and the target to global sovereign ex-U.S. debt rise to 3% from 2.3%. Hedge funds remain at 9%.
Within the real return portfolio, no changes were made. The targets to core real estate, infrastructure and commodities remain at 8%, 1.8% and 0.8%, respectively.
ACERA spokesman Michael Fara could not be immediately reached to provide further information.