New York State Teachers’ backtracks on 2023 PE pacing plan

A dodgy economic picture raises concerns as systems plan for the coming year.

New York State Teachers’ Retirement System will slow its 2023 private equity pacing plan from original estimates.

LPs are evaluating pacing plan schedules for the coming year, trying to balance the need for returns and liquidity in an inflationary economy predicted to head into recession. Many public pension systems are overallocated to private equity and considering options to bring their portfolios back into balance.

New York State Teachers announced a $2 billion private equity pacing plan for 2023 after earlier announcing plans to commit up to $2.4 billion.

“Given the general decline in total assets and our expectations, we’ve determined it’s best to go to a conservative approach,” said New York State Teachers managing director of private equity Gerald Yahoudy.

Yahoudy made his remarks at the system’s board meeting held on October 26. Buyouts viewed a webcast of this meeting.

The $146.2 billion system currently allocates 11.3 percent of its portfolio to private equity, above its target of 9 percent.