LPs

Pennsylvania pension to lose another PE investment officer

-
  • PE officer Brandon Halm leaves PA SERS February 26
  • System has lost three PE professionals since last year
  • Unable to fill vacancies because of statewide hiring freeze

A statewide hiring freeze has left the Pennsylvania State Employees’ Retirement System’s private equity team depleted and unable to fill vacant slots.

That situation will only worsen with the impending departure of Brandon Halm, a director in private equity at PA SERS, whose last day is February 26, according to spokeswoman Pam Hile. Halm joined the system in July 2013, according to his LinkedIn profile.

The private equity team was reduced by several losses and is down to one investment officer, David Felix, director in alternative investments. The head of private equity, Lauren Lenfest, managing director of alternative investments, retired this month. Another senior private equity officer, Michael Beblo, died last year.

The system also lost longtime real assets chief David Kalman, who retired last year. Kalman had worked at the system for 24 years. It’s not clear if the system has filled that role, but the job advertisement for managing director of real assets is still live on the PA SERS website.

“As a state agency, we follow the Commonwealth’s hiring procedures and the recent hiring freeze has delayed that process a little,” Hile said. “Now that portions of the freeze have lifted, we are resuming reviewing applicants.”

Pennsylvania Governor Tom Wolf initiated the hiring freeze in October as state legislators tried to find common ground on a budget. Wolf made his second budget proposal today, which was met with derision by Republicans, according to media reports.

Private equity is especially vulnerable to high team turnover, as the asset class requires “institutional memory” because of its long fund life. Ideally, investment officials who build private equity portfolios stick around to see those investments mature over 10 years or more.

New York City’s pension system last year increased salaries across its investment team to help retain talent. Private equity chief Alex Doñé got a pay increase to $280,000 from $160,000. Doñé was promoted earlier this year to oversee real estate and infrastructure as well as private equity. Eneasz Kadziela, who joined the system last year to work on private equity, got a raise to $130,000 from $95,000.

Action Item: Check out PA SERS strategic investment plan here: http://bit.ly/1ly3aup

Photo courtesy of Shutterstock