The State Universities Retirement System (SURS) of Illinois has approved an investment consultant search, with plans to issue a request for proposals (RFP) on Monday. The broad-based search is intended to identify a general consultant, a real estate consultant or both.
If a real estate consultant is hired, the firm would be the pension plan’s first consultant focused on the asset class. SURS has not had a dedicated real estate-focused consultant to date. Instead, its general consultant has handled real estate services as part of its contract.
San Francisco-based Callan Associates has served as the pension plan’s general consultant since January 2011 and has been invited to rebid. Its current contract with SURS expires on December 31.
The RPF for the investment consultant search will be posted on SURS’ website and advertised nationally beginning on Monday. Finalists are expected to present to the pension system’s investment committee at its October 17 meeting, while the negotiation and execution of a contract is anticipated to occur by the end of the calendar year.
“Over the past several years, as approved in the asset liability studies in both 2008 and 2011, SURS has begun building out its real estate program,” said Daniel Allen, SURS’ chief investment officer, in an email to PERE. “It currently is anticipated that the real estate program will be fully committed in 2015 and maintain the allocation going forward.” He said that additional real estate searches were likely in the coming years.
At its June 2011 board meeting, SURS approved new strategic policy targets that included an increase in its real estate allocation from what was then 6.7 percent to 10 percent over time. Implementation of the new targets began during SURS’ fiscal year 2012, which started on July 1. The pension system’s allocation to real estate was 7.3 percent of its total portfolio as of March 31, according to its website.
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