Ohio SERS Commits $100M to Private Markets to Balance Asset Allocations
The Ohio School Employees Retirement System (SERS) approved $100 million in new private markets commitments as the $23 billion pension fund continues to expand its alternatives portfolio while rebalancing asset allocations following strong equity market performance.
The commitments include $50 million to Marathon Asset-Based Lending Fund IV, a private credit strategy managed by CVC Marathon, and $50 million to StepStone VC Secondaries VII, a venture capital secondary fund targeting opportunities in mature, high-quality private companies and funds.
The allocations come as SERS reported several asset classes had drifted outside their policy ranges on a cash basis during May. Global equities exceeded the plan’s 45% maximum allocation by 0.2 percentage points, reflecting market appreciation that outpaced the pension’s efforts to reduce equity exposure. Staff have been selling public equities to fund capital calls for private equity, infrastructure and private credit investments while also meeting monthly benefit obligations.
Fixed income was 0.1 percentage points below its 13% minimum allocation, while global real estate remained 0.6 percentage points below its 10% target ahead of the implementation of the pension’s fiscal 2027 asset allocation.
SERS noted that both equity and fixed income allocations remained within policy limits when futures positions were included.
The pension’s $1 billion private credit program spans direct lending, mezzanine financing, structured credit and distressed debt strategies. Marathon Asset-Based Lending Fund IV focuses on loans secured by hard assets, including aircraft, railcars, healthcare facilities and industrial equipment. Marathon has invested more than $30 billion in asset-based lending over the past two decades.
The StepStone commitment expands SERS’ $2.8 billion private equity portfolio through venture capital secondaries, providing exposure to seasoned private companies and liquidity transactions, including secondary purchases, continuation vehicles and GP-led restructurings.