The limited partner anticipates committing $175 million to private equity in the first half of 2009, which is well below its normal $500 million per year rate.
CIO Tom Lopez says that the pension fund’s target allocation to private equity remains at 10 percent. As of late November, the market value of LA Fire’s private equity program stood at roughly $684 million, or 6.5% of the fund’s portfolio.
Pledges made in 2008 include ones to ARCIS European Secondary Development Fund IV, designated for buying secondary positions in European private equity funds and funds of funds; Caltius Capital Partners IV, a lower mid-market mezzanine fund; Clayton Dubilier & Rice VIII, a global mega-buyout fund; Clearlake Capital Partners II, a distressed debt fund; Crestview Partners II, earmarked for buyouts in the financial services, media and health care industries; GI Partners Fund III, a buyout fund that makes investments of $25 million to $250 million in management buyouts and turnarounds; Natural Gas Partners IX, earmarked for companies operating at the start of the fuel delivery cycle, where oil and gas are sourced and produced; and Saybrook Corporate Opportunities Fund, a distressed debt fund. —Nancy Gordon
UN pension fund dives into alternative assets
The United Nations Joint Staff Pension Fund is getting into the private equity asset class. Last month, it issued a “request for an expression of interest” to advise it on the implementation of private equity and hedge funds of funds programs. Each sector’s allocation will be roughly $1 billion, about 3% of the $32 billion pension fund.
After receiving some interest, the investor plans to issue a more conventional request for proposal this month, says Arjuna Kadirgamar, procurement officer of the United Nations Procurement Service. Responses to the RFP will be due four to six weeks after it is issued.
The pension fund plans to either choose two consultants to advise on each asset class separately or hire one consultant to cover both.
The private equity program will likely include buyout, venture capital, mezzanine, restructuring and distressed investment strategies. —Nancy Gordon
LACERA taps Pathway to manage $300
Because no request for proposal was issued for this invitation-only search, little information about the $300 million account was made public. However, some of the middle-market pledges the limited partner has made previously include $35 million to Behrman Capital III; $60 million to Berkshire Fund IV; $25 million to Excellere Partners; and $75 million to GTCR Fund VIII.
LACERA’s commitment pace for 2009 has not yet been formulated, according to Christopher Wagner, senior investment officer, private equity. In October, the LP said it had committed $735 million to private equity funds in 2008. —Nancy Gordon
Maine adds staffers
The pension fund, which has assets of $8 billion under management, has been debating whether to hire a dedicated staff or use outside advisors since its board approved a target allocation of 5% to private equity in mid-June. In addition to adding Creedon and Parker, CIO Andrew Sawyer said the state pension fund is likely to move forward with a search for a private equity consultant in the first quarter of 2009.
Sawyer, the third head of investments since 2005, joined the limited partner last February and has led the charge into private equity. He says that the target allocation of 5% is expected to be achieved over the next three to five years. The program is expected to include venture capital, buyout, distressed and mezzanine funds.
In other news, Maine is searching for an executive director to fill the position that will be vacated when Gail Drake Wright retires in February. Hudepohl & Associates is leading the search and is conducting preliminary interviews, according to John Milazzo, general counsel and chief deputy executive director. —Nancy Gordon