Rhode Island State Investment Commission at its July meeting committed to an opportunistic private credit fund from Davidson Kempner Capital Management.
The system invested up to $30 million to the hedge fund’s Long-Term Distressed Opportunities Fund V. The pool focuses on “distressed and growth opportunities across corporate debt and equity, real estate, structured credit and hard assets,” according to a pension investment memo.
Target fund size information for Davidson Kempner’s latest fund wasn’t available. The pool is targeting an internal rate of return in the “mid-teens,” according to meeting notes. Davidson Kempner IV closed at $1.75 billion in 2017, according to Institutional Investor.
Davidson Kempner’s first three distressed funds reached a net IRR of 15.5 percent as of Mar. 31, the memo showed. “The fund will target 20-35 investments across geographies but primarily in developed Europe and North America,” Thomas Lynch, a senior managing director at Cliffwater LLC, said in the memo.
Opportunistic private credit sat at a 1 percent allocation, on a 2 percent target, as of July, according to an asset allocation report.