Investors - NOVEMBER 6, 2014

NMSIC commits $75m to energy

by Reg Clodfelter

After committing to The Blackstone Group’s real estate funds in the past, the New Mexico State Investment Council has turned to the firm’s energy fund series, committing $75 million to Blackstone Energy Partners II.

The commitment was confirmed by Charles Wollmann, director of communications with NMSIC. The full $75 million might not make it into the fund as it is already oversubscribed, according to Wollmann; however, the commitment will not be less than $50 million.

“Its not that unusual with the higher demand funds,” Wollmann says. “We’ve seen a little more of this over the last couple years.”

BEP II, an energy and natural resources vehicle, will reportedly be larger than its predecessor, which closed in September 2012 after raising $2.5 billion. BEP I seeks control and control-oriented equity investments within the energy and natural resources sectors globally.

“There are a lot of attractive things about the fund,” Wollmann adds. “Blackstone has a successful track record in the space, we are looking to increase our real assets allocation and we have a couple of investments with Blackstone on the real estate side that are doing quite well. We also like the multi-tiered talents and broad scope of the organization, all of which helps them to be successful.”

NMSIC committed $75 million to Blackstone Real Estate Partners VII in 2012 and $50 million to Blackstone Real Estate Partners Asia in early 2014, according to IREI’s FundTracker Database.

The investment council has a 10 percent target allocation to the real return asset class. Currently, NMSIC is approximately 5 percent allocated to real return, though that number is closer to 7 percent on a committed basis, according to Wollmann.

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