Alternative Investments: Teachers’ Retirement System (TRS) Of Illinois Plugs $1.5B Into Alternative Investments

Teachers Retirement Systems (TRS) said its long-term funded ratio rose 1.3% during fiscal year 2022 to 43.8%, above TRS’ average funded ratio of 40.7% over the past decade.

The Teachers’ Retirement System (TRS) of the State of Illinois said it allocated nearly $1.5 billion to alternative investments, out of the $2.6 billion it committed since the month of August. (CIO)

Most large institutional investors like TRS lost money during FY 2022. TRS recorded an investment return rate of -1.17%. Nonetheless, the Illinois fund’s rate compared favorably to the median return of -7.6% by large pension systems according to RVK, Inc., of Portland, Oregon, the pension fund’s general investment consultant.

Real assets

Illinois TRS has a $12.4 billion real assets portfolio. New investments of $800 million are planned as follows:

  • Up to $300 million to Starwood Capital Group
  • Up to $200 million to Kohlberg Kravis and Roberts, and
  • $300 million to Brookfield Asset Management

Private Equity

Illinois TRS earmarked $680 million within its $10.2 billion private equity portfolio to:

  • $200 million to Apollo Global Management
  • $150 million to Vista Equity Partners;
  • $75 million to SK Capital Partners,
  • $65 million to Bessemer Venture Partners for two funds
  • $50 million each to Insight Partners, True Ventures, Scale Venture Partners
  • $40 million to Longitude Capital Management.

The Teachers’ Retirement System of the State of Illinois is the 42nd largest pension system in the United States. The System serves 439,000 members and had assets of $63.3 billion as of August 31, 2022.

Related Story: Record Returns At Some Large Pension Funds Driven By Private Equity

Image of Illinois State Capitol Building, Springfield, Illinois: Flickr

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