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Pension boards accept quarterly consultant report; begin search to replace JPMorgan real estate holding
Summary
Mariner presented the June 30 quarterly and July flash reports showing plan assets near $137.2 million and positive recent returns. Trustees authorized staff to begin interviewing core real estate managers to replace the partially redeemed JPMorgan Strategic Property Fund and asked for presentations from shortlisted firms.
The Jacksonville Beach pension boards voted to accept the investment consultant Mariner Institutional's quarterly report and July update and directed staff to begin a search for a replacement for the JPMorgan Strategic Property Fund.
Mariner representative Brandon (listed in the packet as Bridal Mariner) told trustees total plan assets were $134.4 million as of June 30 and that an updated market-value figure calculated the morning of the meeting put assets at about $137.2 million. The firm reported a strong quarter for equities and a positive fixed-income return; for the quarter the plan returned 6.56% (gross of fees) and ranked in the 57th percentile of the public-fund universe. Mariner also noted the plan's cumulative net cash flow since 1987 stood at negative $39.2 million (more paid out than contributed) but that assets continued to grow above the actuarial assumed line.
Nut graf: Trustees cited a run-down of the JPMorgan Strategic Property Fund — which was being redeemed over time and still held about $4.9 million as of June 30 — and asked staff to start a formal process to identify a core real estate replacement so the plan can restore its target allocation without waiting for full redemption.
Brandon reviewed three core open-end property funds proposed as candidates: Clarion Partners' Lion Properties Fund, Stockbridge Smart Markets Fund and TA Realty Core Property Fund. He summarized each fund’s scale, occupancy rates and leverage, and said Clarion listed a $10 million stated minimum but indicated it would accept smaller investments. Trustees discussed manager size, fees (Clarion ~1.10%, Stockbridge ~0.95%, TA ~1.00%), office exposure and lease roll concentrations.
The board consensus was to exclude Clarion from the presentation slate, and to invite Stockbridge and TA Realty to present at a future meeting (trustees discussed Nov. 18 as a likely date). Trustees asked staff to follow up with the consultant to arrange presentations and to confirm whether the managers will accept staged capital calls to match the gradual redemption from JPMorgan.
Mariner also presented an asset-allocation study that modeled modest private-equity allocations (2.5–5.0%) funded from fixed income or public equity. The consultant noted potential increases to long‑term expected return (baseline projected policy return ~7.08% rising to roughly 7.25–7.34% under sample allocations) but flagged implementation tradeoffs: private vehicles have multi-year lockups, slower reporting timelines (which can complicate audits) and call schedules that require planning around cash availability.
Ending: Trustees approved Mariner’s consultant report by motion and roll-call across all boards and directed staff to schedule manager presentations and provide more information about private alternatives before making a commitment. No final manager selection or new commitments were made at the meeting.
