The California State Teachers’ Retirement System (CalSTRS) has released the agenda for its Sept. 4 board meeting, and included a 50-page performance report on its private equity investments. The report showed a marked drop in short-term performance from a similarly-timed report in 2007, and that the portfolio’s returns are right around the State Street industry benchmarks for both short- and long-term horizons. CalSTRS does, however, significantly outperform some custom benchmarks designed for the system by PrivateEdge.
From its 1988 inception through the end of Q1 2008, CalSTRS’ private equity portfolio has earned a net IRR of 19.1%, and currently consists of 268 active investments valued at $15.7 billion. The system is currently over its allocation to buyout and venture capital funds — 74.1% vs. 70% and 7.7% vs. 5%, respectively – and under-allocated to expansion capital, distressed debt and mezzanine. Worth noting, however, that distressed debt was among the areas CalSTRS blamed for its overall value decline (although most of the trouble was with U.S. buyout funds).
CalSTRS also reported that it has committed more than $2 billion to 18 new funds over the first two quarters of 2008. I’ve listed them here, or you can find them in the report beginning at page 27: CalSTRS.pdf