Virginia Retirement System, Richmond, announced hires or commitments totaling $1.97 billion to credit, private equity and real assets managers.
The $82.3 billion pension fund committed $900 million to credit strategies, $575 million to private equity and $195 million to real assets, and hired AQR Capital Management to run a $300 million systemic high-yield credit strategy in its fixed-income portfolio.
The pension fund also terminated two managers. VRS announced the new allocations and terminations at an investment advisory committee meeting Wednesday in a report covering activity since mid-November.
In credit strategies, Virginia committed $300 million to H.I.G. WhiteHorse Direct Lending Fund, managed by H.I.G. Capital's credit affiliate WhiteHorse Capital, $250 million to Ares Pathfinder, an alternative credit fund managed by Ares Management that invests in assets with predictable cash flow; $200 million to Ares Special Opportunities Fund; and $150 million to Varde Mortgage Fund III, a real estate debt fund managed by Varde Partners that invests in commercial and residential mortgages.
In private equity, VRS committed $150 million to Insight Partners XI, a growth equity software fund; $150 million to MBK Partners Fund V, a buyout fund focusing exclusively on northern Asia. Also, $100 million was committed to Madison Dearborn Capital Partners VIII, a middle-market buyout fund managed by Madison Dearborn Partners; $100 million to Odyssey Investment Partners Fund VI, a middle market buyout fund; and $75 million to TA Select Opportunities Fund, a buyout fund managed by TA Associates that focuses on minority recapitalizations of existing TA flagship fund investments.
In real assets, the pension fund committed $120 million to iCon Infrastructure Partners V, a diversified middle-market infrastructure fund; and $75 million to Harrison Street Core Property Fund that focuses on alternative property types in the U.S., including student and senior housing and medical office buildings.
Virginia terminated a $500 million commitment to Zazove Associates' convertible credit strategy, and terminated $150 million from Bridgewater Associates' Optimal Portfolio, a global risk-parity fund that was part of the pension fund's risk-based investments portfolio.
Virginia's asset allocation as of Dec. 31 was 40% public equity, 16% fixed income, 14.2% credit strategies, 13.2% real assets, 12.1% private equity, 1.5% to private investment partnerships, 2.7% to multiasset public strategies and the rest in cash.
