Key Takeaways
- • Callan and Aon Investment Consulting delivered pacing plan recommendations to San Diego County Employees Retirement System (SDCERS) for fiscal year 2026, with a specific commitment target of $80 million for 2025 with flexibility to adjust within a $60 million–$100 million range.
- • Consultants recommended that SDCERS prioritize a balanced allocation combining large-cap and lower- to mid-market buyout funds while expanding international exposure to diversify its private equity portfolio.
- • The recommendations are designed to support SDCERS' ongoing private equity allocation strategy and maintain program diversification as the pension fund manages its capital deployment cycle.
Summary
San Diego County Employees Retirement System (SDCERS) has received private equity pacing plan recommendations from leading institutional investment consultants Callan and Aon Investment Consulting. The recommendations outline strategic adjustments to the pension fund's fiscal year 2026 capital deployment strategy, providing specific guidance on commitment levels and portfolio construction.
For 2025, the consultants recommended that SDCERS commit $80 million in private equity capital, with flexibility to adjust commitments within a range of $60 million to $100 million depending on market conditions and available opportunities. This pacing framework is intended to help SDCERS maintain consistent capital deployment while managing dry powder levels and exposure across its private equity program.
The recommendations emphasize a two-pronged approach to fund selection: prioritizing both large-cap and lower- to mid-market buyout funds. This strategy reflects a balanced philosophy that captures exposure to established, mature-market transactions while maintaining access to growth-oriented mid-market opportunities. Additionally, the consultants recommended expanding international exposure, signaling an intention to diversify SDCERS' geographic footprint beyond domestic U.S. markets and reduce concentration risk inherent in a home-country-biased portfolio.
These pacing recommendations are part of broader institutional capital allocation planning for SDCERS, which, like other large public pension funds, must carefully calibrate annual commitment levels to ensure optimal deployment of assets while maintaining sufficient dry powder for follow-on investments and responding to market dislocations.
For 2025, the consultants recommended that SDCERS commit $80 million in private equity capital, with flexibility to adjust commitments within a range of $60 million to $100 million depending on market conditions and available opportunities. This pacing framework is intended to help SDCERS maintain consistent capital deployment while managing dry powder levels and exposure across its private equity program.
The recommendations emphasize a two-pronged approach to fund selection: prioritizing both large-cap and lower- to mid-market buyout funds. This strategy reflects a balanced philosophy that captures exposure to established, mature-market transactions while maintaining access to growth-oriented mid-market opportunities. Additionally, the consultants recommended expanding international exposure, signaling an intention to diversify SDCERS' geographic footprint beyond domestic U.S. markets and reduce concentration risk inherent in a home-country-biased portfolio.
These pacing recommendations are part of broader institutional capital allocation planning for SDCERS, which, like other large public pension funds, must carefully calibrate annual commitment levels to ensure optimal deployment of assets while maintaining sufficient dry powder for follow-on investments and responding to market dislocations.
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