The California Public Employees’ Retirement System (CalPERS) today identified 14 consultants to assist investments in infrastructure, forestland, and commodities components of the pension fund’s inflation-linked asset class.
“All of these consultants have strong experience in these markets, have worked well with other large institutional investors, and offer a broad array of services as we prepare for new capital deployments in the coming years,” said George Diehr, CalPERS Investment Committee Chair.
CalPERS established its inflation-linked program in January 2008 to provide a hedge against inflation while diversifying investments. The total market value of investments in infrastructure, forestland, commodities, and inflation-linked bonds is $3.7 billion as of October 31, which is 2 percent of CalPERS assets.
The 14 potential contractors submitted proposals after the CalPERS Investment Committee authorized staff to form an external resources pool. All of them qualified for selection in the pool, which investment staff can draw on to solicit competitive proposals for services which are anticipated to include assessing potential investments; strategic advice and research; financial, accounting and tax services, portfolio assistance and debt analysis; assistance in negotiating and evaluating partnership agreements; investment banking-related services; and special projects related to the inflation-linked asset class program.
The infrastructure consultants are Brock Capital Group LLC; Capital Innovations, LLC; Cliffwater LLC; Courtland Partners, Ltd.; Investors Diversified Realty, LLC; KPC Consulting Group, LLC (dba LP Capital Advisors); Magellan Asset Management Limited; Meketa Investment Group; Pension Consulting Alliance, Inc.; R.V. Kuhns & Associates, Inc.; and Wilshire Associates Incorporated.
Forestland consultants are Cortex Consultants, Inc.; James W. Sewall Company; and ORG Portfolio Management LLC.
Cliffwater LLC; R.V. Kuhns & Associates, Inc.; and Wilshire Associates Incorporated also qualified as commodities consultants.
Pending contract negotiations, the consultants will be included in a pool of pre-qualified firms within the first quarter of 2009. Firms can be selected, deleted or added to the pool on a continuous basis during the life of the pool, which shall not exceed a three-year term with an option for two annual extensions. Allocations and recipients are undetermined.
“As a long-term investor, our strategy is to broadly diversify our portfolio, including investments in these sectors,” said Anne Stausboll, Interim Chief Investment Officer. “Our goal is to achieve an earnings return of at least 4 percent above the rate of inflation.”
CalPERS is the nation’s largest public pension fund with more than $181 billion in assets. It provides retirement and health benefits to more than 1.6 million California State, local agency and school employees, retirees and their families. For more on CalPERS, visit www.calpers.ca.gov.
