The $200 billion California Public Employees’ Retirement System, the US’ largest pension system, has appointed its first lead consultant for its infrastructure investment programme.
The pension’s investment committee gave the job to Meketa Investment Group, a Massachusetts-based investment consultant. Meketa beat out Wilshire Consulting, Pension Consulting Alliance and R.V. Kuhns & Associates for the position and will begin its appointment on or around 1 January 2010, CalPERS said in a press release.
To date, CalPERS has committed $700 million to infrastructure, which is part of its inflation-linked asset class. That asset class, launched in 2008, also includes commodities, forestland and inflation-linked bonds.
CalPERS’ inflation-linked portfolio allocation is 5 percent. Within that allocation, infrastructure assets have the flexibility to move to as much as 3 percent of the overall portfolio value.
CalPERS said it has additional investments under review as its infrastructure programme is approaching an allocation of 1.5 percent of CalPERS’ total market value by the end of 2010.
The pension’s performance goal for infrastructure is 5 percent above the consumer price index, a benchmark for the rate of inflation.
Meketa Investment Group was founded in 1978 by James Meketa, a former consultant to the endowment of Harvard University in Cambridge, Massachusetts.