LA Fire & Police Pension outlines investment outlook

Approximately 26% of LA Fire and Police Pensions private equity commitments are dedicated to special situations funds. 

The Los Angeles Fire and Police Pensions (LAFPP) will invest between $300 million and $350 million in private equity and associated debt strategies this year, according to a Portfolio Advisors presentation included in its Thursday meeting materials

The presentation was meant to educate LAFPP’s board of administration on its private equity portfolio, which is valued at slightly more than $3 billion as of 31 December, chief investment officer Tom Lopez told Private Debt Investor. The presentation pegs the sub-allocation to special situations – defined as debt, mezzanine and special situations funds – at roughly 26 percent of LAFPP’s private equity commitments.

“That’s a snapshot of the existing programme,” Lopez said.

LAFPP increased its allocation to private equity from 9 percent to 10 percent last year. Within that portfolio, the $14.7 billion retirement system set a 15 percent to 40 percent target range for special situations funds.

Although several other Southern California retirement systems have increased their commitment pacing or adjusted their allocations to private debt strategies in recent months, Lopez told Private Debt Investor that he has not seen much movement among that segment of fund managers as of late.

“There were an average number of [funds] last year and it’s been about the same this year,” he said. “There were a few more attempts to raise European funds last year, but that’s the only difference.”