The Connecticut Retirement Plans and Trust Funds’ investment advisory council unanimously approved plans for a real estate fund investment consultant search process at its meeting on Wednesday.
The proposed project plan put forth by the office of the Connecticut state treasurer, Denise L. Nappier, intends to initiate a competitive search by issuing an expedited request for qualifications on 20 February. The scope of the consultant mandate will include recommending changes to the investment policy statement annually, due diligence be performed on all prospective real estate fund managers utilizing research and environmental, social and governance factors, and that performance data be tracked at the portfolio and fund levels.
In terms of timeline, to avoid a disruption in service, Connecticut intends to temporarily reup with their current consultant, Townsend Group. This will span the duration of the search process, which began this month and is expected to conclude in June.
The RFQ deadline is set for 13 March at which point the submissions will be verified. That will be followed by due diligence and a selection of semi-finalist candidates, which will be ongoing through the month of April. From there, a round of semi-finalist interviews will be conducted. At the 9th May IAC meeting, Nappier will make a recommendation to the investment advisory committee, which will review the treasurer’s recommendation and provide feedback. Given the expedited nature of the RFQ, a motion will then be presented to waive the 45-day comment period.
During the week of 14 May, the treasurer will consider the IAC’s feedback, designate the preferred vendor and notify the firm. The process will wrap up with a negotiation of fee and contract terms in mid-to-late May, final contract authorization with the state attorney general’s office in June and the awarding of the contract slated for 15 June.
The search screening and selection criteria will look at several factors including organization and management; consulting activities and relevant experience; and cost of proposal. More specifically, CRPTF will be evaluating items such as the business management and stability of the organization; domestic and overseas consulting expertise; quality and timeliness of performance reporting, monitoring, compliance and other reporting requirements; and corporate citizenship and commitment to diversity principles commensurate with those of the pension.
The $32.9 billion US public pension currently has a 7 percent current allocation to real estate, in line with its target.