CalPERS Reports 11.6% Annual Return as PE, Debt Strategies Drive Growth
The California Public Employees Retirement System (CalPERS) posted a robust annual investment return of 11.6% for the fiscal year ending June 30, pushing total fund assets to $556.2 billion, according to figures released this week.
Public equities once again led performance, returning 16.8%, but private equity and private debt strategies also delivered healthy gains, up 14.3% and 12.8%, respectively — evidence that CalPERS’ expanded push into private markets continues to pay dividends.
“Despite some market headwinds earlier in the year, our investment strategy paid off,” said CIO Stephen Gilmore. “The team remains poised to take advantage of investment opportunities as they develop and to strike the best possible deals to boost returns and cut costs for the fund.”
Private equity returns reflect the benefits of a 2022 strategy overhaul that emphasized more co-investments and separate accounts, enabling CalPERS to reduce management fees by roughly 10% over the past few years. The 14%+ private equity return marks a notable improvement from the 10.9% gain for the previous fiscal year.
From October through December 2024 alone, CalPERS deployed $4.8 billion across numerous private equity funds, co-investments, and custom funds-of-one. Notable commitments included $750 million to Patient Square Capital’s Blackwell Capital Partners, with other allocations to blue-chip managers like EQT, TA Associates, General Catalyst, and Andreessen Horowitz. As of May, CalPERS’ private equity holdings totaled roughly $97 billion, or about 18% of the overall portfolio.
Private debt — which CalPERS formally carved out as an asset class in 2022 — continues to build momentum, now exceeding $20 billion in assets. In the final quarter of 2024, the system committed $8.5 billion to diversified credit strategies, including real estate debt. While the 12.8% annual return is solid, it trails the 17% gain CalPERS recorded for private debt in the prior year.
Meanwhile, the real assets portfolio rebounded from last year’s losses, posting a 2.7% gain — a meaningful recovery from the 7% decline for the year ending June 2024.
Taken together, the results signal that CalPERS’ balanced approach — pairing traditional public equities with a growing stable of private market investments — is helping the nation’s largest public pension fund maintain strong performance and cost discipline while weathering ongoing market uncertainty.