Employees Retirement System of Texas is planning to invest $1.55bn (€1.17bn) in infrastructure in the next five years and $300m during the next year fiscal year.
The pension fund has approved a tactical investment plan for private infrastructure that calls for $300m to be committed to the asset class over 12 months from the start of September.
Investing such a volume of capital would enable Texas ERS to reach its 3% target allocation to private infrastructure.
According to documents prepared by the pension fund’s infrastructure consultant Altius Associates, it plans to make up to three commitments in 2014.
Texas ERS has already committed a total of $275m to private infrastructure with $165m of this capital being called.
The pension fund’s existing private infrastructure investments are exclusively in the power generation sector with three co-investments with Panda Power Funds and a $125m commitment to Actis Energy III.
Texas ERS intends to create a portfolio that is diversified by risk, strategy, geography and manager. It will invest in a range of risk-return strategies in the US and Europe, and it will consider both commingled funds and co-investments.
The pension fund also has a 1% allocation to public infrastructure. This will be invested in publicly traded/listed infrastructure securities and be managed by the global equities team of the pension fund.