OAK BROOK, Ill. – The Illinois Municipal Retirement Fund (IMRF) committed $200 million to Earnest Partners, $200 million to Piedmont Investment Advisors, and $200 million to Garcia Hamilton & Associates at today’s full Board Meeting. Including the recent $600 million approval, the three firms manage all of IMRF’s active Core Fixed Income strategies representing $2.2 billion, collectively.
In 2005, Earnest Partners, an African American owned firm, was hired to invest $50 million in a Core Fixed Income Strategy. Over the last 12 years, the portfolio’s market value has grown to $552 million as a result of additional allocations and strong performance. In addition to the Fixed Income mandate, Earnest Partners invests $574 million in an International Equity strategy. In total, Earnest Partners will invest over $1.3 billion across two mandates on behalf of IMRF.
Piedmont Investment Advisors, an African American owned firm, was also hired in 2005 to invest $50 million in a Core Fixed Income Strategy. Due to additional allocations and strong performance, the portfolio’s market value has grown to $553 million. In total, Piedmont will invest approximately $750 million on behalf of IMRF.
In 2015, Garcia Hamilton, a Latino owned firm, was sourced from the Progress Fixed Income manager-of-managers program to invest $100 million in a Core Fixed Income strategy. Subsequently, IMRF allocated $150 million in August 2015 and $275 million in May 2016. As of April 2017, the Garcia Hamilton Core Fixed Income portfolio was valued at $524 million. Garcia Hamilton continues to manage $124.5 million in the Progress Fixed Income manager-of-managers program. In total, Garcia Hamilton will invest approximately $850 million on behalf of IMRF in two Core Fixed Income mandates.
Establishing and building long-term relationships with its investment managers is important to IMRF. The additional allocations to Earnest Partners, Piedmont Investment Advisors and Garcia Hamilton & Associates are prime examples. IMRF increased the goal for the utilization of Minority owned firms in the Fixed Income asset class to 25% in February 2017. Minority owned firms will manage about 38% (estimate) of the Fixed Income asset class after all allocations are funded.
IMRF is committed to diversity in the hiring of Minority owned investment managers as evident by its aspirational goal to have a least 20% of the total Fund’s assets managed by minority and women owned firms. IMRF’s Emerging Manager Program includes 49 Minority-owned firms and valued at $7.3 billion or 19.5 percent of the IMRF portfolio, as of March 31.
For more information on IMRF’s Emerging Manager Program, visit the Investments section. In addition, IMRF has a dedicated and focused team that meets with firms owned by minorities, females and persons with disabilities. Our “open door” policy affords us greater flexibility in meeting with investment managers and broker/dealers. IMRF does not require third-party referrals for investment managers and broker/dealers to pursue opportunities from IMRF.