The $31.8 billion South Carolina Retirement System has plans to change its allocations to real estate and infrastructure, according to the minutes of the Feb. 7 meeting.
Rebecca Gunnlaugsson, the chair, confirmed that the goal is to approve an asset allocation by May 2018 and asked the commissioners to think about information that would be helpful to aid in narrowing down the proposed policy allocations.
Consultant Meketa Investment Group would like to see the pension fund pare down its portfolio’s exposure to liquid infrastructure and move more into the private infrastructure space.
Frank Benham, managing principal and director of research for Meketa, suggested decreasing the allocation to 2 percent for infrastructure and shifting the focus from public infrastructure to private infrastructure investing. Additionally, Benham noted that Meketa believes the pension fund should rebalance the real estate portfolio to have at least half of its allocation invested in core real estate.
Mekata Investment provided three alternative allocation policies. For real estate allocation the pension fund could increase it by 1 percent, from 8 percent to 9 percent. For infrastructure, the allocation could remain at 3 percent or decrease to 2 percent. Both asset classes make up the pension fund’s real assets exposure for its portfolio, representing 11 percent of its current asset under management.
