SF pension adds $126 mln to PE; private-markets exec leaves

  • Why this is important: PE performed well; pension reports 2 key management changes
  • AUM: $24.3 bln
  • PE: Target allocation 18 pct; actual 17.3 pct
  • The new commitments are venture capital and growth strategies
  • Contact SFERS at sfersconnect@sfgov.org

San Francisco Employees’ Retirement System in August and September made $126 million in private equity commitments, targeting growth and venture capital strategies.

SFERS, which has $24.3 billion in assets, invested in three GGV funds, two Level Equity funds and one Polaris Partners fund, a report CIO William Coaker prepared for the system’s Sept. 12 meeting shows.

The report also said retirement system’s managing director of private markets is leaving to take another job, according to the report.

SFERS approved the GGV commitments as part of its venture allocation during the closed session of its Aug. 8 meeting, committing up to $100 million across the three funds.

It closed on those investments on Aug. 15, ultimately investing $48 million in GGV Capital VII, $12 million in GGC Capital VII Plus and $20 million in GGV Discovery II.

The Level Equity investments were also approved on Aug. 8 as part of a growth-equity allocation, with a maximum commitment of up to $40 million, and closed on Aug. 10.

SFERS invested $15 million in Level Equity Growth Partners IV and $10 million in Level Equity Opportunities Fund 2018.

SFERS also invested $21 million in Polaris Growth Fund I, after approving a commitment of up to $30 million at its June meeting.

The pension’s PE allocation is near its 18 percent policy target, with a 17.3 percent actual allocation as of Aug. 31.

Coaker’s report listed private equity as one of the policy areas that worked for SFERS during the past quarter. PE’s 6.1 percent return made it the strongest absolute and relative performing asset class during the quarter.

Within the private equity portfolio, growth capital assets, making up 23.8 percent of the PE portfolio, performed best, followed by VC, opportunistic and buyouts.

Coaker’s report also noted the departure of Art Wang, who spent five years as managing director of private markets at SFERS.

Coaker credited Wang with several significant contributions, including a new private markets strategy, manager relationships, diversification, strengthening the private markets investment team and strong returns over the past five years.

Wang left SFERS to join Franklin Templeton to form a new joint venture between Franklin Templeton and Asia Alternatives called Franklin Templeton Private Equity.

The joint venture aims to provide investors with access to global private equity managers and will begin operations in October 2018, according to Franklin Templeton.

SFERS also hired a new managing director of asset allocation, risk management and innovative solutions, bringing on Anna Langs for the role.

She previously worked at Abu Dhabi Investment Authority, Axa Rosenberg, Fortress Investment Group, First Quadrant, Western Asset Management and D.E. Shaw, according to SFERS.

Action Item: Read more about the pension plan here https://bit.ly/2M99k5G