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Alaska Permanent Fund Corp., Juneau, approved allocating $1.75 billion to its alternative investment programs and authorized manager searches for timber and diversified inflation fund managers, confirmed Laura Achee, spokeswoman for the $40.4 billion fund.
Callan Associates, the fund’s general consultant, will assist with the searches for a timber manager and a diversified inflation manager, both new investments for the fund. How much will be invested in each portfolio hasn’t been determined, Ms. Achee said in a telephone interview.
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“The board believes that alternative investments are important to complement traditional asset classes, adding diversification and improving the fund’s risk-adjusted rate of return,” Bill Moran, APFC board chairman, said in a news release. “For example, timber investments, an asset class that other state funds have been in for some time, show promise to add stability and long-term returns for the permanent fund.”
The board, at its regular meeting May 19-20, also approved allocating $750 million to corporate credit opportunities; $600 million in new private equity investments, which will be made through existing managers Pathway Capital Management and HarbourVest Partners; and $400 million to infrastructure investments, which could include a search for new infrastructure managers.
The fund noted that the private equity investments will be added to a previous $3.1 billion commitment the fund expects to have in place by June 30.
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Ms. Achee said the three new commitments will be funded from the fund’s $25 billion corporate exposure asset class.
The board also authorized the fund to invest in credit opportunity funds via funds of funds, in addition to direct investments.
The fund’s target asset allocation is 36% equities, 23% bonds, 12% real estate, 6% private equity, 6% absolute return, 3% infrastructure, 2% cash and 12% other categories.
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