Credit/Private Debt
The commitment is part of the plan’s new portfolio structure, which introduced a 5%, or roughly $500 million, private debt target allocation in November.
The plan also named finalists in its private credit manager search.
Nonprofits still see opportunities in alternative asset classes, like smaller or specialized buyout strategies, venture funds or private debt strategies that benefit from macro trends like the higher interest rates, rapid development of artificial intelligence or transition to clean energy.
The plan made several commitments in alternatives asset classes in November and December.
2023 was supposed to be a down year for foundations and endowments with a potentially recessionary environment, however, equity and bond returns came out in the green, thanks in part to strong fourth quarters, leaving investors and allocators with a more optimistic outlook for their portfolios entering 2024.
The alternative credit manager has closed its second collateralized fund obligation, which will invest in U.S. senior lending, junior capital and equity co-investments, just below $200 million.
The pension plan expects to conclude the search at its June 12 board of investments meeting.
The plan will consider a recommendation to conduct an RFP for one to two buyout/special situations fund commitments next year.
Institutional investors are bullish on private market investments as the rapid development of artificial intelligence technologies signals future growth in the economy despite looming geopolitical risks, according to a recent survey.
The pension plan liquidated an approximately $237 million global equity mandate and made commitments totaling $1.4 billion in October.