Florida selects Hamilton Lane to manage $250m initiative(2)

Florida Retirement System’s State Board of Administration (SBA), which manages the state’s $113 billion pension, has selected Hamilton Lane to manage an investment programme focused on local private equity opportunities.

Florida Technology and Growth Investment Initiative has been seeded with $250 million for commitments in private equity funds that are based in Florida or that operate in Florida, and direct co-investments in Florida companies.

The programme will target venture capital, growth equity and small to mid-sized buyout opportunities, specifically in local businesses focused on sectors such as technology, aerospace and aviation, renewable energy, medical and life sciences.

SBA is looking to enter 15 to 20 partnerships with private equity firms with commitments ranging from $10 million to $20 million. For co-investments, SBA will look to invest in 20 to 25 companies with investments ranging in size from $5 million to $15 million.

Hamilton Lane will leverage its national private equity network, as well as communicate with managers who have existing relationships with SBA to source potential co-investments, according to documents from SBA.

SBA allocates 5 percent of its asset to private equity investments. The pension increased its active general partner relationships from 37 – on 31 December, 2007 – to 46 on 31 December 2008.

The pension had committed $13 billion to private equity as of 31 December, 2008, and has $3.8 billion in unfunded commitments. The pension committed more than $1.8 billion in 2008 to 19 new partnerships. SBA has a total of 116 partnerships with 61 managers.

Florida has made more than $1 billion in private equity commitments in the past year, including $200 million to First Reserve Fund XII, which closed on $9 billion in April; $100 million to Ares Corporate Opportunities Fund III; $50 to the $500 million Cressey & Company Fund IV and $150 million to TCW Crescent Mezzanine Partners V, which has collected $2.5 billion.