News & Analysis

CalSTRS searches for private equity consultant

The pension system re-bids the private equity consulting contract every five years. The contract is held by Pension Consulting Alliance until June 2012.

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The California State Teachers’ Retirement System, which has a $21.5 billion private equity portfolio, has initiated a search for a private equity consultant.

The system’s current consultant, Pension Consulting Alliance, has a contract that ends in June 2012. The pension system re-bids the contract every five years, according to documents from CalSTRS.

CalSTRS staff will interview semi-finalists in January and conduct final interviews in February.

The first advisory firm the system worked with was Abbott Capital, which was hired in 1988. Abbott was replaced by Pathway Capital Management, which held the contract until 2002, when McKinsey & Company took over. PCA has been on the job since 2007.

CalSTRS has an in-house staff of 13 employees that manage the private equity portfolio, which is made up mostly of fund commitments to managers, according to documents. The portfolio also includes co-investments and secondary interests.