San Bernardino County Employees Retirement Association
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File #: 23-402    Name:
Type: Information Item
File created: 9/21/2023 In control: INVESTMENT COMMITTEE
On agenda: 11/16/2023 Final action:
Title: Pathway Capital Manager Update.
Attachments: 1. Exhibit A: Pathway Capital Presentation
Date Ver.Action ByActionResultAction DetailsMeeting DetailsVideo
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FROM:                                            Don Pierce, Chief Investment Officer

 

SUBJECT:                                            Informational:  Pathway Capital Manager Update

 

RECOMMENDATION:

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Pathway Capital Manager Update.

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BACKGROUND:

Pathway Capital Management (“PCM”) is a private assets manager based in Irvine, California. Founded in 1991 with a focus in private equity, PCM currently manages about $90 billion in private equity, credit, and infrastructure investments.

 

SBCERA committed to Pathway Private Equity Fund VII (“PPEF VII”) in with an initial commitment of $604 million in January 2004. PPEV VII invested $906 million in 73 primary fund commitments from 2004 through 2013 and has generated a net 1.72x DPI, 1.92x TVPI and 12.7% IRR as of June 30, 2023. Net asset value is $192.7 million.

 

In December 2013, SBCERA and PCM entered into an evergreen MCA agreement with an initial commitment of $280 million. The relationship has since committed $894.4 million to 155 investments across primary, co-investments, secondary transactions. Through June 30, 2023, the MCA structure has generated a net 0.71x DPI, 1.72X TVPI, and 21.8% IRR. Net asset value is $614.9 million.

 

Private Equity continues to be an important asset class for SBCERA target allocation of 18% and an expected return of 9.2% over a 10-year period. SBCERA’s private equity budget for 2023 is $525 million including an allocation of $75 million to PCM.

 

BUDGET IMPACT:

Investment Costs are deducted from Net Asset Value.

 

STRATEGIC PLANNING GOAL/OBJECTIVE:

Prudent Fiscal Management

 

STAFF CONTACT:

Amit Thanki

 

ATTACHMENTS:

Exhibit A:                     Pathway Capital Presentation