The State Board of Administration (SBA) of Florida is considering restructuring some of its portfolios.
The pension fund is considering combining real estate, which has a 10 percent target allocation, with real assets (composed of timber and infrastructure), which has a 1 percent target allocation. This would help align the real estate portfolio, which is currently overweight, with its allocation target and would also repackage the strategic investments portfolio, which also has a real estate allocation. As of March 2, the actual real estate allocation was 11.8 percent.
SBA Florida said reclassifying those two segments of the strategic investments would allow strategic investments to play more of a diversification role in the total portfolio.
The real estate portfolio is anchored by its core component, while the noncore component is expected to be a source of excess returns. Looking forward, SBA aims to utilize liquidity to exploit market inefficiencies and will
