Alaska Permanent Fund’s PE program nets 21 pct in FY 2017

  • Strong performance boosted overall returns above benchmark
  • Program expanding “talent pool” as it consolidates GP relationships
  • Alaska’s fund value swells to record $59.8 bln

Alaska Permanent Fund Corp’s $4.6 billion private equity program returned 20.98 percent in the 2017 fiscal year, boosting Alaska’s overall return of 12.57 percent on the year.

“The private equity and special growth opportunities portfolios were strong contributors to the overall portfolio gain,” according to an Aug. 18 news release. The portfolio returned a three-year net internal rate of return of 17.22 percent, and its five-year IRR notched 18.2 percent.

Alaska’s PE program has increasingly dedicated more resources to direct investments and co-investments in recent years, including stakes in Ministry Brands and American Homes 4 Rent, as well as co-investments led by Dyal Capital Partners and Thoma Bravo.

Over the next year, Alaska Permanent Fund plans to “build [its] talent pool” as it deploys capital in emerging markets, along with planned projects in Japan, India and Northern Europe, according to a May presentation. The sovereign-wealth fund will also consolidate its program among fewer general partners.

Alaska’s private equity performance helped lift its overall investment portfolio over its benchmark, which returned 10.26 percent last year. The relative outperformance represented roughly $1.2 billion of additional gains, bringing the sovereign wealth fund’s overall value to a record $59.8 billion.

Action Item: Alaska Permanent Fund:

U.S. Navy safety swimmers stand on the deck of the Virginia class submarine USS New Hampshire after it surfaced through thin ice during exercises underneath ice in the Arctic Ocean north of Prudhoe Bay, Alaska, on March 19, 2011.  Photo courtesy Reuters/Lucas Jackson