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PCA resigns as CalPERS’s PE consultant

  • Firm was due $1.7 mln over remainder of contract
  • Meketa to take over, pending CalPERS vote
  • PCA to remain CalPERS secondary, real estate consultant

Pension Consulting Alliance resigned its contract as private equity consultant with California Public Employees’ Retirement System, according to a letter signed by Managing Director Allan Emkin.

It’s unclear why the firm resigned. The PE consultant advises the CalPERS board on its $25.4 billion portfolio.

PCA signed its most recent contract with the $310.8 billion retirement system in mid-2015 and stood to make roughly $1.7 million across its remaining 3 1/2 years, retirement-system documents show.

The letter, addressed to CalPERS investment committee Chairman Henry Jones, says PCA’s resignation is effective March 16. The firm will continue to consult on the pension system’s real estate portfolio, in addition to its role as CalPERS’s second overall investment consultant.

“We want to thank PCA for their work and contributions on our private equity portfolio and look forward to continuing to work with them in their capacity as our real estate and secondary pension consultant,” CalPERS spokeswoman Megan White said in an email.

CalPERS is one of PCA’s three largest clients, along with California State Teachers’ Retirement System and New York State Common Retirement Fund, CalPERS documents show. As of late 2014, the firm represented 32 clients with more than $1 trillion of assets.

CalPERS will hold a vote to replace PCA with Meketa Investment Group at its March meeting, scheduled for next week. If that contract is approved, the retirement system would pay Meketa roughly $1.9 million over the next 2 1/2 years, or $200,000 more than what was due PCA.

CalPERS considered Meketa a finalist for the position in 2014 before it eventually awarded the contract to Pension Consulting Alliance.

Emkin could not be reached for comment.

Action Item: For more information about CalPERS, visit www.calpers.ca.gov/page/home

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