State Investment Council sends out $927M for investments

New Mexico’s most recent round of outgoing commitments for investments neared $1 billion.

The New Mexico State Investment Council met on Tuesday and doled out more than $927 million in commitments in private equity, real assets, real estate and private debt.

Oaktree Capital Management and FPA Multifamily received the largest commitments, both getting up to $200 million.

Oaktree is a U.S.-based global investment manager with more than $205 billion in assets under management. It invests primarily in four areas: aging infrastructure, energy efficiency, renewable energy and electric load growth, according to the SIC.

With the $200 million from New Mexico, Oaktree plans to make control investments in middle-market companies that supply products and services to infrastructure owners.

FPA Multifamily is headquartered in California and has $9.6 billion in AUM. The company plans to use the $200 million from New Mexico to acquire “undercapitalized, undermanaged” suburban apartments in major job and population growth markets.

The state also sent $150 million to the privately held U.S. real estate investment management company Berkshire Group LLC. The company has $28.2 billion in real estate AUM, equating to about 489,000 residential units owned, managed or overseen across the U.S., on behalf of different global institutional investors, according to the SIC.

Berkshire’s investment strategy focuses on the Freddie Mac K-Program debt products. The program utilizes multifamily mortgage securitization to transfer a portion of balance sheet risk to the private sector, according to the SIC, and has multifamily loans.

Denmark-based Copenhagen Infrastructure Partners got a $100 million commitment plus up to $37.5 million in a co-investment vehicle from the SIC. The firm has $32.7 billion AUM and prioritizes investing in renewable energy, power, waste and renewable technologies projects.

UP Partners, founded in 2020, received three separate investments totaling $80 million:

• $34 million for its early-stage venture capital fund that will invest at the seed and Series A stages in companies using technology to make transportation clean, safe and efficient
• $26 million for its venture capital fund that will invest in startups created by a network of corporate venture labs that act as company builders, including a New Mexico lab
• $20 million for its pre-seed and seed stage venture capital fund that will invest up to $1 million in New Mexico climate tech startups

The private equity program through the SIC should be a “startup attraction magnet. Combine that with clean energy investments pouring into New Mexico and the entire Southwest, and New Mexico was the perfect place to launch a climate tech startup attraction program,” according to an overview from UP Partners.

The SIC also approved a commitment of up to $75 million for Sweetwater Capital Partners, a private equity firm that purchases equity positions in high-performing companies — either late-stage venture, growth or lower mid-market buyout — at a discount in the secondary market.

Sweetwater has made investments in technology, health care and consumer product companies, including in companies like Kore.ai, HouseCanary, NextRoll, and Savage X.

The state sent up to $45 million to an early-stage venture capital firm that invests in seed rounds, specifically companies operating in the business-to-business software sectors in the U.S. The capital firm, California-based firm Bonfire Ventures, which was launched in 2017, has $1 billion AUM.

The smallest commitment of up to $40 million went to Lerer Hippeau, a generalist early-stage venture capital firm based in New York City. The firm invests in pre-seed and seed companies across consumer and enterprise landscapes in New York City.

The SIC also had its regular performance update report at the meeting, including a breakdown of money in the state’s funds as of Oct. 31. The state has a total of $57.8 billion in managed net assets across its funds:

• Land Grant Permanent Fund: $32.6 billion
• Severance Tax Permanent Fund: $9.9 billion
• Early Childhood Education and Care Fund: $8.3 billion
• Tax Stabilization Reserve Fund: $2.2 billion
• Higher Education Trust Fund: $949 million
• Capital Development and Reserve Fund: $492 million
• Conservation Legacy Permanent Fund: $364 million
• Tobacco Settlement Permanent Fund: $377 million
• Water Trust Fund: $198 million
• Opioid Settlement Restricted Fund: $100 million
• Rural Libraries Endowment Fund: $32.7 million
• Workforce Development & Apprenticeship Trust Fund: $26 million