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New Jersey to consider ‘significant’ alternatives increase

The US state’s $63bn pension, which has not made a commitment since 2008, currently has a 7% private equity target.

Orin Kramer, the outgoing chairman of New Jersey’s State Investment Council, will recommend a “significant” increase to the $63 billion pension’s allocation to alternatives.

Kramer, who is stepping down as chairman of the council at the meeting this week, declined to provide further details as to potential allocation increases. He was speaking at an institutional investor forum in New York.

The pension first carved out a 7 percent allocation to private equity in 2005, with the anticipation of revisiting the allocation target in 2010. The actual allocation stands at about 6.4 percent, according to pension documents.

“It’s time to put on the table a significant increase in those numbers,” Kramer said. “When it was first done, the plan was that this would carry us for five years.”

Kramer, a partner in hedge fund Boston Provident Partners, has been advocating for an increase in New Jersey’s alternatives exposure for months. Total alternatives exposure is capped at 28 percent of the total fund.

New Jersey has not made a commitment to private equity since 2008. The pension had been considering setting up a secondaries programme, but that has been stalled.