Florida ends year committing more than $900 mln

  • New commitments include Ares, Warburg flagships
  • $136.8 bln retirement system is roughly at 6 pct PE target
  • Florida commits $750 mln to special situations, debt funds

The Florida State Board of Administration committed more than $900 million to private equity in the fourth quarter of 2015, the pension board reported in a recent disclosure.

Florida SBA, which manages more than $171 billion, committed to new flagship offerings from firms like Ares ManagementSearchlight Capital and Warburg Pincus in the fourth quarter. Its largest commitment, for $500 million, went to a co-investment pool managed by secondaries specialist Lexington Partners (see Florida SBA 4th quarter commitments).

Florida SBA oversees the investment portfolio of the state’s $136.8 billion retirement system along with approximately $25 billion in other retirement and investment assets. Florida’s retirement system valued its private equity portfolio at approximately $8.4 billion as of November 30, according to pension documents.

It is not clear how much Florida plans to commit to private equity in 2016, though spokesman Dennis MacKee said the system is “fairly close to our target right now.” Florida SBA held a 5.9 percent allocation to the asset class as of Nov. 30, just a tenth of a percentage point short of its 6 percent target.

In addition to private equity, Florida SBA committed approximately $750 million to a variety of private funds through its “strategic investments” allocation. Florida’s strategic investments portfolio, valued at $10.75 billion as of November, includes commitments to a variety of distressed debt and special situations funds managed by firms like Oaktree Capital Management and Blackstone Group’s credit arm GSO Capital Partners.

Florida’s fourth quarter strategic investments included a $200 million allocation to Cerberus Capital Management’s fourth real estate fund and a $150 million commitment to Colony Capital’s latest distressed debt and special situations fund.

Action Item: For more information about Florida SBA, view its most recent investment report at http://bit.ly/1QEMFqE