Emerging and Diverse Manager Program
Emerging and diverse Manager Program Although not widely known, Los Angeles Fire and Police Pensions (LAFPP) has been a leader in this area since the late 1980s. LAFPP began hiring and engaging emerging and diverse managers in 1987 and over the many years, various managers have been hired to manage equities, fixed income, real estate and private equity. LAFPP has also employed diverse consultants who have provided different services to the Fund over these many years.
Currently, LAFPP has over $1.9 billion invested with diverse investment firms across all asset classes. As a percent of assets under management (AUM), the Fund has one of the highest percentages of any pension fund across the nation.
LAFPP’s Emerging Manager Program consists of hiring direct managers and fund of funds managers in the stock and bond portfolio. Altogether, the Fund has over $1.5 billion invested with diverse stock and bond managers. Many of the emerging managers in the Program started with smaller accounts (AUM), but their AUMs for the Fund have grown larger as they have been successful in growing the Fund’s investments. Currently, the Fund has invested approximately $300 million in fund of funds managers, but will be shifting $100 million to hire directly several large cap equity, small cap/micro cap equity and fixed income managers.
The Fund has also committed or funded over $344 million to diverse private equity and real estate managers. The Fund created a Specialized Manager Program to attract and invest in newer private equity funds.
Currently, the Fund is in the process of searching for several large cap, small-cap and bond fund emerging managers to manage part of a new $100 million allocation. The results of the searches will presented to the Board in the early part of 2015.