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- January 1, 2015: Vol. 27, Number 1

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CalPERS plans expansion of infrastructure program

by Reg Clodfelter

 

There is an unofficial rule in poker, sports and investing: Play the hot hand.

In the case of the California Public Employees’ Retirement System, that hot hand is its infrastructure portfolio, which returned 22.8 percent for the year ended June 30, 2014. The program has had an even greater five-year return of 23.3 percent annually, beating its 6.7 percent benchmark by 16.6 percent.

So it comes as no surprise that CalPERS is going to play that hot hand by boosting its infrastructure portfolio by $5 billion in the next three years, increasing the program from $1.8 billion to $6.7 billion by fiscal year 2016–2017.

During the past year, CalPERS made $682 million in infrastructure commitments and launched its first nondiscretionary infrastructure separate account, a mode of investment that, along with direct investment, the $300 billion pension fund is looking to expand in the future.

CalPERS is looking to invest more than $700 million in Cal

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