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NY State Common commits $350m to in-state PE funds

Several state pension funds have programs that use their capital to invest in local companies.

New York State Common Retirement Fund will commit $350 million to two private equity funds managed by Hamilton Lane that invest in companies located in the Empire State.

A handful of states have similar programmes that steer pension fund capital into private equity vehicles that invest in local businesses. But the size of New York State’s In-State Private Equity Investment Program stands out.

According to a press release from the Office of the New York State Comptroller, NYS Common fund will commit $300 million to the new Hudson River Co-Investment Fund IV. The system will also provide an additional $50 million to Hudson River Co-Investment Fund III, which already had $300 million in commitments.

“The In-State Program has helped hundreds of New York businesses add and retain thousands of jobs and grow while achieving solid returns for the retirement system members and their beneficiaries that rely on the pension fund for their retirement security,” State Comptroller Thomas DiNapoli said in a press release.

Hamilton Lane manages the series of Hudson River Co-Investment funds, according to a spokesperson from the firm.

David Helgerson, a managing director and co-head of impact investments at Hamilton Lane, leads the funds, according to the company.

The press release states that Fund IV intends to build a portfolio of 16 to 18 co-investments for companies valued between $10 million and $1 billion. Both Fund III and Fund IV will invest between $5 million to $20 million to healthcare, technology, transportation, business services and manufacturing companies.

New York State has committed $2.1 billion to 56 different funds through its in-state programme. A total of $1.6 billion has been invested in 522 New York companies to date, with more than half of that capital sent to companies based in counties outside New York City, according to the press release.

A spokesperson from the Office of the New York State Comptroller said the agency does not disclose the returns of individual funds.

Pre-made-food delivery service RealEats and biopharma supply chain company AeroSafe Global are companies that have benefited from the In-State Private Equity Program, according to the Office of the New York State Comptroller.

RealEats is based in Geneva, while AeroSafe Global is headquartered in Rochester.

Hamilton Lane manages similar in-state investment funds in Florida and Nevada, according to a company spokesperson.

Other state pension plans with similar programmes include California Public Employees’ Retirement System, Alaska Permanent Fund, New Mexico State Investment Council and the North Dakota Retirement and Investment Office.