Denver Employees Retirement Plan increased its target allocations to private debt and infrastructure, lowered its target to emerging markets equities and eliminated its emerging markets debt asset class.
The $2.8 billion pension fund’s board approved the changes following the presentation of the results of an asset-liability study at its July 19 meeting, recently released meeting minutes showed.
The changes are an increase in the targets to private debt to 6.5% from 4% and infrastructure to 4.5% from 3%, a decrease in the target to emerging markets equities to 6% from 8% and the elimination of the 2% target to emerging markets debt.
The minutes also mention increasing the target to private real estate debt by 2 percentage points and lowering the target to core real estate by 2 percentage points. According to the pension fund’s most recent comprehensive annual financial report, the overall target to real estate is 10% and it was not broken down by styles of real estate.
The minutes did not say whether any manager searches or terminations could occur due to the changes. CIO Randall Baum could not be immediately reached for further information.
According to the minutes, the changes were recommended in order to maintain the pension fund’s 7% expected rate of return but lower volatility.
Targets that remain unchanged are 22% domestic equities, 15% core fixed income, 14% international developed markets equities, 10% real estate, 9% private equity, 7% absolute return, 3.5% natural resources and 2.5% distressed debt.
Recent actual allocation information was not provided.
