CalPERS to create 13% real assets allocation and replace benchmark
The California Public Employees’ Retirement System (CalPERS) is planning to consolidate its real estate, infrastructure and forestry investments into a single 13% real assets allocation.
The $316bn (€298bn) pension fund is also to adopt a single MSCI benchmark for real assets, replacing the National Council of Real Estate Investment Fiduciaries (NCREIF) Open-Ended Core Equity (ODCE) index, according to board meeting documents.
The changes, to be considered at its investment committee meeting next week, build on efforts to harmonise CalPERS’s real asset investments.
Paul Mouchakkaa, managing investment director for real assets, will argue that the new allocation and benchmark will enable CalPERS to underwrite real estate, infrastructure and forestry investments while seeking simliar underlying investment characteristics.
CalPERS believe the changes will also foster greater teamwork between the three areas.
CalPERS currently has 11% in real estate, 1% in infrastructure and 1% forestry.
It will combine these into a 13% real assets allocation that uses the MSCI Investment Property Databank US Core–Fund Level benchmark.