Dear Fund members,
I am proud to announce that HFRRF has been recognized by the American Investment Council (AIC) for outstanding achievement. According to the AIC’s 2019 Public Pension Study, HFRRF ranks seventh in the nation for highest private equity returns and is the only Texas pension system in the top ten.
HFRRF is part of a growing number of Texas pension systems to include private equity in their investment strategy to maximize returns. The long-term nature of private equity parallels the long-term liability profile of pension funds. AIC’s study confirms that private equity continues to deliver better results than all other asset classes over the long term. Based on available data as of June 30, 2018, private equity’s median 10-year annualized return is 10.2 percent. Compare that to public equity at 8.5 percent, fixed income at 4.8 percent and real estate at 4.8 percent. HFRRF’s return for private equity during that same period is 11.1 percent, only 2.5 percent behind Massachusetts Pension Reserves Investment Trust, the top ranked public pension fund in the study.
HFRRF’s mission is to provide a secure retirement benefit plan for you. Our investment team, under the leadership of CIO Ajit Singh, deserves recognition for their commitment to this goal. According to Art Alfaro, executive director of TEXPERS, “The Houston Firefighters’ Relief & Retirement Fund is certainly a leader among local systems in profitably managing a large allocation to this promising asset class. Given the future projections for capital market performance, private equity is a viable option for systems to diversify and meet their return assumptions with the goal of achieving retirement security for public employees.”
Until next time…
Brett R. Besselman, Chair
Houston Firefighters’ Relief and Retirement Fund
Board of Trustees