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Investment consultant reports 10% quarter return; proposes adding infrastructure asset class
Summary
Foster & Foster's investment presenter reported the plan ended the quarter at about $21.45 million with strong equity returns and suggested reducing real-estate targets and introducing an infrastructure allocation as a diversification/income alternative.
The board heard a quarterly investment report showing the pension plan at roughly $21,450,000 at quarter end and net returns that outpaced the policy index. Brandon (speaker 7) said the plan was ‘‘up 10.1% net of fees’’ for the quarter and noted equities were overweight (about 68%) while real estate was underweight relative to policy targets.
Brandon proposed reducing the real-estate target and introducing an infrastructure asset class to provide income and diversification. He cautioned there is ‘‘no free lunch’’ and described infrastructure and private real-estate as less liquid, often quarter-based with manager discretion on redemptions; trustees asked for more detail and said redeployment decisions should wait until the full board can consider options.
