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Virginia commits $800 mln to accounts

  • Grosvenor to invest in small, emerging managers
  • $200 mln committed to Asia Alternatives account
  • System raised PE allocation to 12 pct last year

The accounts, which launched in June, were presented by Chief Investment Officer Ronald Schmitz at the retirement system’s Aug. 19 investment advisory committee meeting.

The $600 million account with Grosvenor will invest in small and emerging managers. Chenault declined to provide any additional information on either account. Grosvenor’s private markets business invests its clients’ separate account capital in private equity, real estate and infrastructure strategies. The program, which has $21 billion of assets under management, also manages co-investment strategies.

The $66 billion retirement system committed $200 million to its Asia Alternatives account. The firm manages an Asian fund-of-funds strategy that has access to private equity managers operating in China, Japan, Korea, South East Asia, Australia and India, according to its website. Asia Alternatives closed its previous flagship fund, Asia Alternatives Capital Partners III, on $908 million in 2012. The firm disclosed that it had raised an additional $600 million through separate accounts for individual limited partners at the time of the close.

In addition to its commitments to Grosvenor and Asia Alternatives, Schmitz also disclosed more than $160 million in direct fund investments. In June and July, the Virginia system allocated $85 million to Spectrum Equity VII, $50 million to Vista Equity Partners Fund V and $30 million to ABRY Partners VIII.

The commitment to ABRY Partners is Virginia’s second in recent memory. The retirement system disclosed a $30 million commitment to the firm’s Advanced Securities Fund III in June. Other commitments disclosed at that time included $150 million to Sycamore Partners II and $100 million to Littlejohn Fund V.

Virginia Retirement System had a 7.9 percent allocation to private equity as of March 31, according to an investment report. The retirement system increased its target allocation to private equity from 9 percent to 12 percent last year.

The Richmond, Virginia-headquartered retirement system generated a 15.7 percent return for the fiscal year ending June 30, 2014, Chenault told Buyouts.