Philly Pledges $20M To Blackstone; 3-4 Years From Hitting Target Allocation

The City of Philadelphia Board of Pensions and Retirement has continued its relationship with The Blackstone Group, committing $20 million to Blackstone Capital Partners VI, according to Christopher McDonough, chief information officer. The pension fund previously pledged similar amounts to Funds IV and V.

The $4.7 billion pension fund, with 9 percent invested in private equity, remains well below its target allocation of 12 percent. “We would hope to reach our target in three to four years,” McDonough told Buyouts.

Blackstone Capital Partners VI is earmarked for leveraged buyouts, corporate partnerships, growth equity and strategic minority investments around the world. The firm held a first close in August at $7.1 billion. Altogether, the firm seeks $19.5 billion for the fund, which had 76 backers as of mid-August, according to a regulatory filing.

Philadelphia tends to make individual commitments of between $15 million and $30 million, and uses Franklin Park Associates as its advisor and Fairview Capital Partners for funds of funds.

Other recent pledges by the state include a $25 million commitment to lower-middle market buyout fund Levine Leichtman Capital Partners IV LP, as well as to Altaris Healthcare Partners II LP ($20 million); KPS Special Situations Fund III LP ($20 million); Platinum Equity Capital Partners II LP ($20 million); Riverside Capital Appreciation Fund V LP ($20 million); and Sterling Capital Partners III LP ($20 million).

The City of Philadelphia Board of Pensions and Retirement provides benefits to the police, fire and civilian workers of the City of Philadelphia and covers 65,000 active and retired employees. It began committing to private equity in 1991.