Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Investments topic
No spam. Unsubscribe anytime.
Investment consultant urges steady course as pension fund weathers volatility; private debt and real estate cited as offsets, crypto dismissed
Summary
The fund's investment consultant reviewed a second-quarter investment and a flash report through April 30, reported a fiscal year-to-date decline of 2.23%, highlighted private debt and real estate returns that offset equity weakness, recommended holding cash as opportunity capital, and advised against investing plan assets in cryptocurrency.
The City of Kissimmee General Employees' Pension Board heard its quarterly investment and a flash report from the plan's investment consultant, who said the fund has navigated a volatile market by leaning into private debt and selected real estate managers while holding opportunistic cash.
"Fiscal year to date, the plan is down 2.23%" the consultant said, adding that the portfolio's structure and allocations helped limit losses during a period when domestic growth stocks fell sharply. He told trustees the plan's diversified exposure to international equities and value managers partially offset declines in growth-oriented U.S. equities.
The consultant highlighted specific private-debt and real-estate results: "We're closing out the Crescent Fund with a nice 7% return. LBC is also winding down close to an 8% return. Monroe Capital is generating 7.6% and Carlyle Direct Lending is generating 4.2%" and he described strong operating metrics at several real estate managers, with occupancy above 90% for most holdings.
On liquidity and cash, the consultant reported a $5,400,000 cash position representing about 3.4% of total assets and said that cash was intentionally being held as opportunity capital while earning roughly 4% in a Treasury money-market fund.
Trustees asked about cryptocurrency. The consultant said the plan's position is not to invest in digital currencies. "We have not been proponents of investing in digital currency," he said, adding that cryptocurrencies do not produce income (no coupon or dividend) and lack government backing that would let a public sponsor "buy back" a position to protect value.
On tactical moves and manager performance, the consultant recommended maintaining the current allocation, noting private credit and real estate contributions and that equities should be revisited as market conditions normalize. He answered trustee questions about underperforming active equity managers by recommending continued monitoring and a review next quarter if underperformance persists.
No formal change to asset allocation was approved at the meeting; trustees accepted the report and proceeded to other agenda items.
