Ill SURS Picks Two For Infrastructure

The State Universities Retirement System of Illinois recently pledged a total of $80 million to two infrastructure funds, Alinda Capital Partners Alinda Infrastructure Fund II and Macquarie Capital’s Macquarie Infrastructure Partners II, with each firm receiving a $40 million mandate.

The limited partner approved a search for infrastructure managers in September 2008. Consultant Ennis Knupp reviewed the 30 responses to an RFP and narrowed the list down to six. In addition to the two firms chosen, the semi-finalists included Brookfield Asset Management; JP Morgan Asset Management; Kohlberg Kravis Roberts & Co.; and UBS.

Alinda Capital Partners invests in transportation, energy, power, water and utility services designed for commercial industrial and residential customers, mainly in North America, with up to 25 percent going to Europe. Macquarie Infrastructure Partners II is earmarked for infrastructure investments in the United States and Canada.

The Illinois pension fund has an actual allocation to private equity of 8 percent, according to Douglas Wesley, deputy CIO. Its target allocation is 6 percent, with a range of 3 percent to 9 percent. Its current funding plan is to pledge $300 million to private equity each year between 2009 and 2011. Uncommitted amounts from the preceding year can be carried over to the next year.

The LP relies in part on funds-of-funds managers Adams Street Partners, Muller & Monroe Asset Management, Pantheon Ventures and Progress Investment Management Company to invest its private equity dollars. The pension fund had assets under management of $11.9 billion as of August 31.

The State Universities Retirement System of Illinois is searching for an executive director and chief executive officer to replace Dan Slack, who resigned last year to become chief executive of the Fire and Police Pension Association of Colorado. Interim Executive Director Judith Parker told Buyouts that candidates selected by the search subcommittee will be interviewed by the full board in early December and an offer of employment should follow shortly thereafter.