California Public Employees’ Retirement System (CalPERS) intends to increase its focus on sustainable investment opportunities as it grows its infrastructure portfolio.
In September last year, IPE Real Assets reported that the $443bn (€410bn) pension fund had estimated that it would need to commit approximately $5bn to new infrastructure investments every year to maintain its new real assets allocation target.
CalPERS had made the decision to increase its target allocation for real assets from 13% to 15%.
Following an annual review of its $71.2bn (€65.9bn) real assets portfolio, CalPERS said it planned for infrastructure to have an increased focus on sustainability investment opportunities, including energy transition, renewables, carbon neutral and sustainability-certified assets.
The pension fund’s real assets portfolio comprises $14.1bn in infrastructure and $56.8bn in real estate assets.
CalPERS plans to expand its relationships with infrastructure managers which currently include Global Infrastructure Partners, Stonepeak, Harbert Management, QIC and IFM Investors.
The pension fund’s growth plan for real estate includes making non-core investments. Non-core currently represents $6bn of the real estate portfolio.
CalPERS invests in real estate mostly through separate accounts and some funds, co-investments and direct investments.
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