Texas Municipal Retirement System, Austin, at a Dec. 3 board meeting approved a staff recommendation to commit $600 million to existing alternatives strategic partner H.I.G. Capital for investment in two separately managed accounts.
Trustees of the $31.5 billion system approved allowing investment officers to allocate $500 million to H.I.G. Strategic Partnership Fund II and $100 million to H.I.G. Capital-TMRS Capella SMA, confirmed T.J. Carlson, the system's CIO, in an interview.
Mr. Carlson said TMRS' new strategic partnership fund with H.I.G. will be a fund of funds that will invest in the firm's various alternative investment strategies. The Capella fund is a co-investment fund which will invest in a subset of the partnership fund's transactions.
The latest commitment to H.I.G. extends the system's relationship with the manager; in 2018, the system committed a total of $300 million to similar funds managed by H.I.G.
The pacing plan for the new H.I.G. funds will commit a total of $150 million per year between 2021 and 2024, Mr. Carlson said.
In a report to the board of brustees from the investment team, TMRS staff said the breakdown of the total allocation to the H.I.G. funds will be 50% private equity, 30% real assets and 20% credit strategies.