Oregon Investment Council (PERS): Private Equity Investments

Here is a link to the history of private equity investments by Oregon PERS going back to 1981. The listing shows that more than $5 billion in new committments have been made to the private equity area in the last 18 months. KKR alone has received more than $2.5 billion in the last 3 years.

Although the historical returns looks good, it is hard to tell the real actual returns since the summary does not account for the time value of money given that some of the returns occurred 25 years ago, etc. In addition, private equity firms value the companies they own themselves since they are not publicly traded. Previously the OIC showed the total current outstanding balance of private equity on its quarterly spreadsheet yet this amount is now part of the overall OPERF total and not broken out separately. See quarterly excel spreadsheet summarizing portfolio.

One thing is clear and that is that a significant increase in private equity investments has occurred recently. In May of 2006 I wrote the following article titled PERS-The Amazing Carry Fee and Tax Loophole for Brainstorm NW summarizing the growth and related fees associated with these investments.

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