OP&F Investment notes, June 2024

Portfolio value: The OP&F portfolio was valued at $18.2 billion as of June 18.

OP&F makes two private commitments

The OP&F Board approved two commitments to its private credit portfolio during its meetings on June 18-19. The two commitments conclude the 2023 plan year for private credit which ends June 30.

OP&F has committed up to $50 million to the OHA Senior Private Lending Fund. The fund will invest in loans to upper middle-market barrowers in diversified industries, including health care, software, industry and financials, primarily in the U.S.

Another commitment of up to $50 million was made to Fortress Lending Fund IV. Fortress will focus on a broad range of industries primarily in North America.

The commitments are a part of the 2023-24 Private Credit Investment Plan and are the fifth and sixth commitments of the plan year, bringing total commitments to $300 million. The target for commitments for the plan year is between $235 million and $285 million. OP&F’s private credit portfolio is valued at $575 million, or 3.2 percent of the total portfolio. The current, interim target for private credit is 4.0 percent with an ultimate long-term target of 5.0 percent.

Private credit plan announced for 2024-25

The Board also approved the private credit plan for the next plan year, which runs from July 1 to June 30, 2025. The target range for new commitments in the plan year is from $215-265 million. OP&F estimates this would be approximately 4-5 commitments of up to $50 million each, along with $25 - $50 million for the private credit co-investment program. The aim is to reach the 5.0 percent target for private credit in 2028.

Real estate portfolio adds commitment to Fairfield

OP&F has committed up to $75 million to the real estate fund, Fairfield Value-Add Multi-Family Fund IV. The value-add fund focuses on multi-family opportunities in the U.S. This is the third real estate commitment for OP&F in 2024, totaling $225 million. The target for 2024 is between $225 and $275 million. OP&F’s real estate portfolio is valued at $1.83 billion, or 10.1 percent of the total portfolio. The target for real estate is 12 percent.

Posted 6/26/2024