CalSTRS drops $7.4bn in private funds in H2 2021

The $320 billion California State Teachers’ Retirement System, which in recent years has been focused on ESG initiatives across its portfolio, ramped up its private market exposure by more than H2 $7.4 billion last year.

More than 50 new investments were tapped over the second half of 2021 across private equity and real estate mandates. A full list of the mandates can be found below.

Since its 1988 inception CalSTRS private equity program has had an internal rate of return of 14%. In the second half of last year officials added 13 funds to its already 440 partnership-strong, $45 billion program. Another $2.1 billion was allocated to new limited partnerships while another $1.5 billion flowed directly into co-investments.

For the year ending Sept. 30, 2021, the Sacramento-based pension fund put $9.8 billion to work in the asset class, which was more than the previous year’s $6.2 billion contributions. The contributions for 2021 were 4 times more than what the system had done in 2009. Currently, CalSTRS is slightly above its benchmark target allocation to private equity at 13.8% of the overall investment portfolio.

Meanwhile, the $42 billion real estate program at CalSTRS is still slightly behind the 14% long-term target allocation slated in the pension fund’s asset mix. For the year ended Sept. 30, the overall real estate program returned 16.9%.

CalSTRS Private Market Mandates at a glance

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