OP&F ups allocation, commits to Meridiam North America III

After its first infrastructure investment last month, the Ohio pension has pledged up to $80m to Meridiam’s third North American fund and upped its real assets target.

The $15.1 billion Ohio Police and Fire Pension Fund has increased its real assets allocation target to 8 percent of its total portfolio after committing to two new funds since May.

OP&F also said it has earmarked up to $80 million for the Meridiam North America Infrastructure III Fund. The allocation comes a month after the pension approved its first investment in infrastructure by pledging $140 million to IFM Investor’s open-ended Global Infrastructure Fund. It also committed $50 million to Agricultural Capital Management Fund II.

The new policy is part of OP&F’s efforts to broaden its timber-only real assets holdings to include infrastructure and agriculture. The $303 million portfolio – not including the above allocations – currently represents 2 percent of OP&F’s total assets . When the new infrastructure and agriculture commitments are added in, the pension’s real assets portfolio will be at around half its target, at 4 percent.

“It became difficult to identify acceptable timber opportunities” that would allow the pension to reach its objective, an OP&F spokesman told Infrastructure Investor in May, when its target was at five percent. That has now increased by 3 percentage points.

Meridiam’s third North American infrastructure fund has not been publicly announced, but OP&F said in notes from its June meeting the vehicle will focus on greenfield PPP opportunities in transportation, social and environmental sectors in the US and Canada. Meridiam Infrastructure North America II closed in 2012 on $1.05 billion.

Meridiam declined to comment.