Oregon seeks new CIO as Skjervem set to depart

John Skjervem will step down at the end of March, leaving Oregon State Treasury after more than seven years and after growing the alternatives portfolio from roughly $375m to $7.1bn.

John Skjervem is leaving the Oregon State Treasury, having joined the agency in November 2012, to assume the role of chief executive at Alan Biller and Associates, an investment advisory firm based in his home state of California.

In a staff memo last week shared with Infrastructure Investor, Oregon state treasurer Tobias Read said: “During John’s time at Treasury, his achievements include strategically re-positioning our asset classes and thoughtfully de-risking our portfolio; reducing operating expenses by increasing the proportion of assets managed internally, resulting in net cost savings of more than $1 million per month; and delivering continuously strong fund performance, especially compared to our public fund peers.”

Skjervem joined OST, which manages the $82.1 billion Oregon Public Employees’ Retirement Fund in accordance with the policies and asset allocation targets set by the Oregon Investment Council, a year after the investment council launched an alternatives strategy.

Initially, the target allocation for alternatives – which includes hedge funds, infrastructure, natural resources and commodities – was set at 5 percent. It has since been increased three times and is currently set at 15 percent.

The target allocation for infrastructure within alternatives is set at 20 percent with a range of 15 to 25 percent. As of April 2019, the net asset value of the infrastructure portfolio stood at $2.1 billion, representing 29 percent of the overall alternatives portfolio, which amounted to $7.1 billion, according to meeting documents.

Since inception, $11.1 billion of commitments have been authorised with the majority ($5.9 billion, or 53 percent) over the past three years, Skjervem said at a meeting last June while presenting an annual review of OPERF’s alternatives portfolio to the Oregon Investment Council.

OPERF has steadily built out its infrastructure portfolio with sizable cheques to major infrastructure fund managers. In 2018 alone it committed $150 million to Digital Colony Partners, $230 million to a separately managed account alongside Westbourne Capital’s infrastructure debt fund, $290 million to EQT Infrastructure IV and $400 million to GIP IV.

Last year, it also committed $400 million to Brookfield’s fourth flagship fund, which closed on $20 billion earlier this month.

According to documents published on the OST website, “specific infrastructure sector exposures will likely include energy, transportation, ports and water in both domestic and international markets and comprising both mid-size and large capitalisation enterprises.”

“Leading the OST Investment Division over the past 7+ years has been, without a doubt, the highlight of my professional career,” Skjervem said in a note to his team. “I am immensely proud of the progress we have made together. I’m prouder still of the truly world class investment organisation we have built, and its hugely accretive financial impact on Oregon and the many beneficiaries we serve.”

Asked who will be succeeding Skjervem, a spokeswoman for OST said: “We expect to follow a similar process to how Treasury recruited John in 2012 and will have more details soon on a national search.”