CalPERS narrows search for infra consultant(2)

Investment staff at the California Public Employees’ Retirement System (CalPERS) has narrowed the search for an infrastructure board investment consultant to three finalists: Courtland Partners, StepStone Group and the pension fund’s current consultant Meketa Investment Group, recommending to the Investment Committee that the three firms proceed to the interview stage of the selection process.

The Investment Committee was scheduled to vote on the recommendation during a meeting on Monday.

“Approving the recommended Finalists for the Consultant will minimise any interruptions to the provision of critical consultant services to support the IC in its fiduciary duty to the beneficiaries,” the investment staff wrote in a letter addressed to the committee. Meketa was hired as CalPERS’ infrastructure consultant on March 2, 2009 and its contract expires March 1, 2015.

As the fiduciary advisor to the investment committee, the infrastructure consultant will provide independent review and recommendations on strategy and policy analysis, performance analysis and monitoring and other projects as requested by the committee.

Founded in Boston in 1978, Meketa is a full service investment consulting and advisory firm. It began advising clients on real estate, infrastructure and natural resources in 1993. Meketa’s other institutional clients include the California State Teachers’ Retirement System and the Arizona State Retirement System.

Ohio-based Courtland Partners has offered real estate-related investment consulting services since 1995, later expanding its line of business to include infrastructure, timber and agriculture. Some of the firm’s largest clients include the Washington State Investment Board, the State of Wisconsin Investment Board and the North Carolina Retirement System.

StepStone Group, headquartered in New York, is a global private markets firm representing public and corporate pension funds as well as other institutional investors. Founded in 2007, the firm established a business unit dedicated to infrastructure and real assets in 2013. Its clients include the Pennsylvania State Employees’ Retirement System, the New York City Employees’ Retirement System and the New York Police Pension Fund.

With a portfolio of $290.5 billion, CalPERS is the largest public pension fund in the country. In July it increased its allocation to infrastructure to 3 percent from 2 percent previously. As of April 30, it had invested $1.16 billion in the asset class representing 0.5 percent of its portfolio.

In the month of August, the pension fund announced a $500 million strategic partnership with UBS and commitments to Morgan Stanley Infrastructure Partners II and UBS International Infrastructure Fund totaling $550 million.

Based in Sacramento, CalPERS administers health and retirement benefits on behalf of 3,089 public school, local agency and state employers. The institution counts more than 1.7 million members in its retirement system and more than 1.3 million in its health plans.