San Jose FCERS unveils FY 2023 pacing plan

The Californian pension has outlined its plans for investment into private equity over the next 12 months.

Institution: San Jose Federated City Employees’ Retirement System
Headquarters: San Jose, US
AUM: $2.84 billion
Allocation to alternatives: 28.62%

San Jose Federated City Employees’ Retirement System has outlined its private markets pacing plan for fiscal year 2022-23, according to materials set to be confirmed in its upcoming investment committee meeting.

The Californian public pension has outlined $149 million for investment into private markets for FY 2022-23 – down from the $162 million pacing projection for FY 2021-22. The actual investment into private markets for FY 2021-22 will reach $167 million by June 30.

Of this $149 million, $55 million is slated for private equity investment. This comprises $30 million for investment into venture capital, with the other $25 million for buyout vehicles.

Furthermore, San Jose FCERS has confirmed three commitments to private equity vehicles across FY 2021-22. $6 million was allocated each to Tembo Capital Mining Fund III, Mountain Capital Partners II and Hull Street Energy Partners II.

Tembo Capital launched its third fund in July 2020, holding a final close for the fund at $380 million in October 2021, oversubscribed to its $300 million target size.

Mountain Capital Management launched its second energy fund in September 2019, targeting $650 million in investor capital. As of April 2022, Mountain Capital Management has raised $500 million for the fund.

Hull Street Energy held a final close for its second energy fund in March 2022, having raised over $1.1 billion in investor capital. The fund attracted interest from numerous other LP’s such as Florida Retirement System Trust Fund and New York State Common Retirement Fund.

San Jose Federated City Employees’ Retirement System currently allocates 16.75 percent of its investment portfolio to private equity, comprising $475 million in capital.

As illustrated below, the $2.84 billion public pension’s recent private equity commitments have tended to target North American vehicles in the energy/renewables sphere.

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