Minnesota State Board of Investment, St. Paul, approved commitments totaling about $1.1 billion from the state's $89.5 billion combined defined benefit plan portfolio, during a meeting Wednesday.
The commitments, pending successful contract negotiations by the board's executive director, were made to eight private market funds run by six money managers.
The allocation to combined private market strategies totals 25.7% of the defined benefit pool, according to the SBI's June 30 performance report. The report does not provide the breakdown by subasset classes.
Private equity commitments to four funds managed by three investment managers totaled $650 million, with the largest allocation — $300 million — awarded to Summit Partners Growth Equity Fund XI. Summit Partners is an existing manager within the combined funds' portfolio.
Existing manager Carlyle Group received commitments to two private equity funds, with $150 million going to Carlyle Partners VIII and $100 million to Carlyle/MN Co-Invest, a separately managed account.
Asia Alternatives Management's $100 million follow-on commitment is a top-up to the $100 million the SBI committed to MN Asia Investors, a separate account, in 2020, confirmed Mansco Perry III, the board's executive director and CIO, in an email.
A total of $225 million was committed to two existing managers for three real estate funds.
SBI investment officers committed $125 million to KKR & Co.'s KKR Real Estate Partners Americas III.
Blackstone Group's real estate unit received a $100 million commitment to Blackstone Real Estate Partners Asia III.
KKR also received a $100 million commitment from the combined funds' real assets portfolio to KKR Global Infrastructure Investors IV.
Sixth Street Partners, a new private credit manager for the SBI, received a $75 million commitment to Sixth Street Opportunities Partners V.
In other news from the SBI meeting, board members approved retaining current investment consultants — Aon Investments and Meketa Investment Group — pending successful contract negotiations by Mr. Perry.
The SBI's consultant search was launched in June as part of the board's regular rebidding process. Aon and Meketa's five-year contracts will expire in the first quarter of 2022, Mr. Perry said in an email.
The SBI had a total of $129.2 billion in assets as of June 30. In addition to $89.5 billion in combined state defined benefit plans, the SBI had $10.1 billion in participant-directed public defined contribution plans and other state funds totaling $29.6 billion.
