New York pension forms JV with Capital Constellation
The $268 billion New York State Common Retirement Fund (NYSCRF) formalized a joint venture alongside numerous institutional asset owners around the world with alternative asset manager Capital Constellation.
Capital Constellation, whose portfolio is managed by Wafra, has grown into a multi-billion-dollar investment platform by investing in nine alternative asset managers across North America and Europe. The partnership is a private equity platform investing in alternative asset managers that is also a global consortium of ‘like-minded asset owners.’
New York joins Constellation as an equal partner and becomes part of a larger platform that counts the Kuwait Investment Authority and the Third Swedish National Pension Fund among its members.
“For over a decade, the NYSCRF has been a significant investor in emerging managers,” said Navyug Patel, deputy CIO of NYSCRF.
Constellation provides a global partnership of asset owners who seek access to the economics of private markets firms and the next generation of investment talent, added Andreas Dische, senior investment officer of the NYSCRF and a strategic committee member of Constellation.
Founded in 2018 as a partnership between the Alaska Permanent Fund Corporation, the Public Institution for Social Security of Kuwait and Railpen in the U.K., Constellation has seen growing interest from the investor community.
“Constellation has had a very successful first few years and we are energized by the additional momentum that the New York State Common Retirement Fund brings,” noted Steve Moseley, Deputy CIO of the Alaska Permanent Fund and founding member of Constellation’s Board.
“Railpen shares New York Common’s generational time horizon and sense of service to our constituency, and with the addition of New York as a partner, we look forward to realizing the mission and vision of Constellation,” said Richard Williams, CIO of Railpen and a member of Constellation’s Board.
Sulaiman Alderbas, head of alternatives at PIFSS in Kuwait and a strategic committee member of Constellation added, “New York Common is a highly respected asset owner, and we recognize the immense value in having them join Constellation.”
Meanwhile at NYSCRF, trustees have placed a total of $740 million to work in October within alternative assets.
Other recent private equity investments for NYSCRF are Insight Partners XII ($300 million) and JVP Growth Opportunity X ($10 million).
The Insight Partners allocation is slated to pursue growth stage investments in software, software-enabled services, and internet companies, primarily in North America.
The investment in the JVP Growth fund is through the Hamilton Lane/NYSCRF Israel Fund, which brings up the total commitment to the fund to $20 million. The retirement system originally invested $10 million with JVP in February 2021. According to regulatory documents the Jerusalem Venture Partners’ fund was slated to raise $450 million.
Glenn Schwaber, an investor in one of the funds advised by Jerusalem Venture Partners, recently sued JVP, and the prominent Israeli venture capitalist who founded it, in the Court of Chancery of Delaware, challenging transactions in which he alleges that Erel Margalit, the founder and chairman of JVP, broke the law by self-dealing.
Within credit strategies, NYSCRF allocated $250 million to the Owl Rock Diversified Lending Fund, which offers non-bank financing to upper middle-market companies.
Lastly within opportunistic absolute return strategies, a $170 million allocation was made to the Frazier Life Sciences Public Fund. Managed by Frazier Life Sciences, the fund is a closed-ended fund focused on investing in public and crossover/mezzanine securities of biotech and life sciences companies.
