US - The advisory council that oversees the management of New Jersey's state pension funds has chosen the Townsend Group as real estate advisor, even as the council faces two lawsuits challenging the basis of the alternative investment plan.
The New Jersey State Investment Council - which oversees the management of $68bn in pension assets for the state’s public employees - selected the Townsend Group as part of its first ever allocation to external managers for a $9bn alternative investment plan, said Kathy Hennessy, a spokeswoman in the New Jersey state treasurer’s office. The State Investment Council advises State Treasurer John McCormac (pictured) on the management of the pension funds.
The Townsend Group was awarded a three-year contract worth $400,000 annually. Mandates for venture capital and private equity advisors will be awarded “in the near future,” Hennessy said.
Strategic Investment Solutions is the general consultant on the alternative asset policy and may serve as one of the asset class advisors, she added.
The investment council’s decision to pursue an alternative investment allocation was made over the summer and has prompted two lawsuits from public employee unions whose members are part of the pension plans. The unions allege that by pursuing an external management plan, the funds could be manipulated and mandates could be awarded to political campaign supporters.
In other news, Peter Langerman, the director of the Division of Investment, which handles the investment of most of the pension funds’ assets, has left his position to return to the private sector. William Clark, who served as deputy director, will assume Langerman’s position, Hennessy confirmed.
The Pensions and Lifetime Savings Association (PLSA) has announced it will shrink its board by more than one-third as part of a governance overhaul to make it "agile and more appropriate".
Smaller FTSE 350 defined benefit (DB) schemes were nearly 15 percentage points less well-funded than larger schemes in 2017, according to a Goldman Sachs Asset Management (GSAM) analysis.
The advent of collective pension systems could help the UK avoid demographic challenges which will make it "impossible" for society to help savers in retirement, experts say.