Dan Jansen >> here. >> Christine Hoffman >> here. >> Brandon Morzma. >> Eddie Vgara here. >> David Cohill >> here. John Patrick >> here. >> Matthew Brocky,
>> John Gustella >> here. >> Jason Sharp >> here. >> George Canler. John Wiggins >> here. >> John McDaniel >> here. >> Lance Huish. Let the record note that Mr. Canandler
has joined us and we have a quorum on all three of our boards. We did we already do the oath oath of office. Is it oaths of office or oath of offices? Yeah. Think on that two in the morning. Okay. So, we're done with that. Moving
on to approval of minutes. We have the quarterly pension board meeting minutes held on September 9th. Um, sorry. We have a motion for approval. Is there a second? >> Second. >> All in favor signify by saying I. >> I. >> Any opposed? I just did that as a whole
board. Is that okay? We good? All right. Moving on to new business. Uh, consultants reports we have. Do you want to take this over? Who's taken over? >> I will jump in real quick. >> Um, so really first on the agenda, we have the uh the real estate presentations. So, in the stack of books
from me, the one on the top um is the the core, it says core real estate search. Um really, I'm just pointing this out kind of as a reference. So, as the the presenters are going, if you want to by chance, you know, look and see how the different strategies stack up kind of next to each other, whether
it be office holdings or retail exposure or what have you, we've got that comparison information here. Um but obviously, they're going to be walking you through their presentation book. Um, but then after the the conclusion of those three presentations, we'll kind of circle back and go back over this to to
discuss. Um, but with that, do you have any questions before we turn it over to principal for the first of the presentations? All right, gentlemen, please. >> Thank you. >> Thank you all. Uh, thank you for having us here. Uh, my name is Greg Pittinger. I'm a client adviser with principal asset management based in Raleigh, North
Carolina. And, uh, work with institutional investors like yourselves all throughout the southeast. have uh worked with Florida pension investors in the public space for the last 15 years. So, thank you for having us here today. My colleague Darren Cice uh is our portfolio manager for the US property account which is our core real estate
vehicle we'll be discussing today. Um you should all have a a presentation from us. It's kind of the dark blue u sorry the first page dark blue for principal asset management. Uh I'll give you a brief overview of principal asset management and the real estate platform and then we'll dive into the strategy. Um but on page four of our presentation
you'll see we're a top 10 global real estate manager uh managing a little over $ 105 billion in real estate assets uh at the end of last quarter. Um one thing a deep heritage of working with public pension plans like yourselves for the last 60 years. Uh one differentiator there I'll point out on our right side
we call it our four quadrants and today we're going to be talking about that royal blue top left quadrant which is our core and value ad private equity real estate uh area. gets the lion share of our our assets at 55 billion of the 105 billion. So, as Darren's team needs access to any resources within the firm,
he gets it. Obviously, that that's where the focus of the uh one of our crown jewels on in our real estate practice is. But the differentiator really is that we all have uh private equity real estate as well as public real estate. So, REITs as well as on the debt side, private real estate debt and public real
estate debt. What that does is for you all as as clients brings the deep resources of uh our rest of our team to to Darren to figure out what's happening in each of the spaces in each geography what actually is happening both on the debt side and the equity side of a opportunity. So it gives uh Darren's
team some some deep insight on your behalf to to make transactions happen whether we're looking to buy an asset or to sell an asset. There's any uh questions on the real estate franchise I'm happy to answer them otherwise we can go right into the uh portfolio. Thank you.
>> Great. Thanks. Thanks, Greg. Um, I'm Darren Clyice. I've been with Principal since 1992. Uh, I've been working on the assets of this fund or the fund itself since 1994. So, got a long history with a firm and with the portfolio and and the assets. And so, um, Principal is a
very good good place to do what we do. We're a large retirement services company and a big part of that is our real estate operation. and uh you know we're very much strong believers that real estate's got a very very uh big big uh place in retirement
plans. So, excuse me. Some real high level stats on the fund. Uh, on slide eight there, uh, we're about 11 billion fund. We've got 125 properties. Our leverage ratio there is, uh, about 26%. That's simply the amount of debt divided
into our total assets. So, relatively low leverage. A lot of real estate strategies operate with a lot more debt. And so, debt is great when it magnifies returns when things are going great. and it magnifies things when you know the negative returns when it's not doing so well. So, we're relatively low leverage
strategy. Um, our 36 million square feet is about 92% occupied. And then we've got a strong one-year net absorption. That's simply a measure of the square footage or the space that's leased today that was not leased a year ago. So, got good momentum in leasing space within
the portfolio and that'll soon start paying rent uh if it hasn't already. got 129 institutional investors such as yourselves and that's everyone from the you know the state of Florida the state board of administration is one of our larger investors in this fund down to
smaller plans like uh Jacksonville city of Jacksonville Jacksonville police and fire and uh Gainesville uh as well as smaller investors like Pompo Beach and so >> sure is there a location where we could see all who all these all your listed investors
>> we we don't publish a list of our investors But I'm just mentioning the ones that are public and are publicly, you know, it's if you wanted to search for these plans, you would see them in public records. So we we don't publish a client list or anything like that. So >> Okay. Thank you.
>> Um but uh you know a couple things on uh investor flows there. We we do not have a contribution queue. In other words, we're taking contributions on a daily basis. We strike a daily net asset value for this fund. And so we if investor
sends us money today we it get goes into the account and is invested today. And if an investor gets money out you know today as well they get out with all the information that we know about the value of the property because we strike a daily what we call NAV or net asset value for the fund each day. So you
don't have to get in and out on a certain on quarter end or anything like that because we do price this and principal is one of the largest 401k providers. this is available to defined contribution to 401k investors and we strike a daily nav for for that investor. So all of our investors get
the benefit of that daily pricing. Um and so yeah there's no magic to coming in at the quarter end or at the beginning of the quarter or anything like that. And so we just um announced on last Friday we we just what we call cleared our queue. So the investors wanting to get money out of the fund, we
in addition to all other real estate funds have a withdrawal queue and um we we've cleared ours now twice. We cleared it last Friday and we cleared it uh in February of this year as well. So investors that wanted money out could get their money out. Um so in the 43year
existence of this fund, we've had a withdrawal queue in place three times. Uh other than that, we have daily liquidity um for this fund. So until there's a little more certainty around the economy and the real estate markets, we're going to keep that uh queue in place. Uh but our our goal is to go back
to that daily liquidity. So if you want money out tomorrow, you'd be able to get money out tomorrow. I mean, that's for 90% of the fund's existence. That's the kind of liquidity we've had in this fund. And so we're we're looking to get back to that. But there's still a lot of funds that do have withdrawal cues. What we don't want to do is become a a source
of liquidity for those investors that have investments in multiple real estate funds. And so until there's a little more liquidity in the industry uh in general, we'll probably have that withdrawal queue in place. >> Real quick, sorry. >> In 43 years, you've had it three times.
You had it twice this year. Is that correct? >> Uh well, we consider this once. So we had it once during the global financial crisis in 2008. We had one during COVID and then we put one in place in July of 22 when interest rates went up, you
know, really fast uh really quickly and the market had not not repriced. Um we put a queue in place and so that queue is still in place. >> Okay. Thank you. >> Even though we've we've cleared it, we've we provided uh liquidity for all those investors that wanted it.
>> Okay. Thank you. >> Slide nine is just a Sure. Is there another question? Okay. Yeah, I had a question. Sure. >> What does that Q look like? Is it 2% a month or >> um it's probably about four on average
four to5 million a week and a lot of that is those defined contribution participants that you know look to rebalance and automatic with with rebalancing or something like that. And so it's probably you know on average four to five million a week. Um initially it was a lot of large
investors that uh had strict asset allocation guidelines and when uh they were overweight to found themselves overweight to real estate and so they rebalanced. So initially it was a lot of institutional investors and now it's more defined contribution participant
directed money that's primarily in that queue. >> Yeah. I wasn't asking who was in the queue. I was asking how you guys restrict the flows like do you guys cap a percentage of NAV flowing out every month or you know 1% of the fund 2% of
the fund um all withdrawals are are are cued with the exception of mandatory death disability and um benefits other than that every everybody is cued everyone's treated the same
>> yes how what percentage of the fund do you allow out during this queue. You said you cleared it. So obviously there's there's got to be a cap that you allow over a certain period of time. >> We satisfied 100% of the investors that
wanted money out. I don't know. Does that answer your question or >> No. Okay. >> The Q is the queue is there to slow the money down coming out so everybody doesn't hit the door at the same time. >> It's to stop it. It stops the all the money. Yeah. But you still are letting
some money out. >> Let me jump in. I when the Q's in place, they get to give no money until they're ready to give some money. Some could be all, right? So if the Q's in place and
you ask for money, there's no guarantee you're getting anything for a number of months, potentially quarters as long as that that cue's in place. But it just so happens that as that that queue has built up over the past couple
of years, it's gotten to a it was at a level where they could go ahead and make the decision. Okay, we've got the liquidity. And I'm just going to make this number up, but it was $200 million that happened to be sitting there in the queue. They looked at their profile and said, we okay, we can we can access the 200 and completely pay off everybody
that wants their money. Now, had it been 200 and they looked and they only had 100, then they would have given everybody 50 cents on the dollar that they had asked for and then that other hundred would just stay there in the queue. I understand. So, so the queue basically is is zero. Like we don't have
to let anything out. We'll let it out as we want. >> And it can be a bit chunky. It's not Yeah. You're asking 1% or 2%. It could be like we paid out 200 million one time. So, it's not a portion of that. It's when we also sell a building and have some liquidity available. >> Got it. Okay, I get it.
>> And just to put that into perspective, too, we are in a fund with JP Morgan in the redemption queue. They've been averaging paying you about 5% on a quarterly basis. Now, that could all of a sudden jump to 30 40 50% of of the
outstanding balance at any point, but but they're in control of that. >> Is everybody getting a part of that queue? So >> yeah, it's pro it's prorup. >> So not one person in the front gets it. >> Correct. It's not just like the first person in line gets their dollar back
before anybody else. It's it's all of the dollars that are in the queue. And then again, my example, if 200 is in the queue and they've got a hundred that they can pay, then everybody gets 50 cents on the dollar for what they have requested.
>> Yeah, that's right. So we just made a little over $200 million available. And actually just our largest I got an email before I came in here. our largest investor declined to take that their Q payment. So they want to stay invested in the fund. So the reasons that they got in the Q are no longer valid today. You know, they're they thought they
could avoid some write downs that were coming in real estate or they were overallocated in real estate, but now that the other asset classes have done well, they're like, well, the reasons we got in the queue aren't valid anymore, so I just want to keep my money in there and I I want to get out of the queue. So
that that's becoming more common too is just as the market as NABS have adjusted to the current current prices. So page nine is just a couple, you know, things that have resonated with our our our current investors that have chosen
to invest with us. Uh, you know, long-term outperformance, that's at the top of the list. And so we we're outperforming our our benchmark or essentially the market for real estate funds like ours over all time periods. Uh we're very uh very good option for a lot of pension
fund investors. We're a retirement services company. We're very used to managing pension money and and clearly uh value and and view this investment in the context of an overall investment portfolio growing uh NOI which is net operating
income. The couple ways we make money in real estate. One is the rents we collect, the income we collect, but also the appreciation. So, it's a pretty simple business. Uh, we just try to buy good buildings in this. I know you guys look at a lot of asset classes that are a lot more complex and a lot of financial engineering. Ours is a pretty
simple business. We just try to buy good buildings we can lease out and that are going to be worth more uh in a few years than they are today than we can buy them for today. Uh, we got a very strong research group uh that we generate a lot of research with um that's available to all of our clients and as well as us. uh
we're really good at just working the you know the operations of the property as well. Uh that's demonstrated by that that strong leasing number that I got there that I mentioned earlier and then also uh our average cost of debt capital where um we got a slide on that a little bit later.
Uh turning to slide 10 just some things that we think about as strategy the fund. We've got um as you can see the vast majority of the properties in the fund are stabilized well- leased assets but we do have a couple other opportunities to add to the portfolio in terms of buying taking some intentional
leasing risk and and groundup development risk. We have two assets in that development uh bucket right now. One is some apartments in Los Angeles on Sunset Boulevard and the second one is a industrial development in Austin, Texas, just north of the the new Tesla
Gigafactory in Austin. And so, uh, we just signed a 270,000 foot lease with Tesla in the second quarter for a building that wasn't even completed with construction yet. Um, and we're actually, uh, in final negotiations with them to take a couple other buildings there as well. So, very good, very
well-located property that's attracting a lot of uh brand name tenants. Slide 11 is just uh pretty self-explanatory where we've got the portfolio position from a market perspective. We do have a couple assets here in Jacksonville. We've got some industrial out on Pritchard Road just
off 295 on the west side of Jacksonville. Um, we got a building leased to carparts.com and a building leased to Home Depot and Pods as well as some industrial buildings up by the airport just south of uh um west of 95 and just south of Airport Boulevard. So,
uh we we are invested here in Jacksonville. Um not in Jacksonville Beach, but we are in Jacksonville and like the market and have done done well here. Got a page devoted to each of the main property types that we're invested in. There there's four main property types that have kind of comprised core
portfolio investments. Um the ones we like the best are are industrial and we've got overweight to positions to industrial and residential. And you might think of residential as just rental housing and all different kinds of rental housing whether it be student housing at Duke University um down to,
you know, manufactured housing or affordable workforce housing as well as some really high high quality uh renter by choice that really caters to that segment of the population that can afford to buy a home but chooses to rent for um for whatever reason. Um, so
>> anything in the uh short-term vacation rental? >> Uh, no. We we have nothing in that space. Uh, we used to have a few tenants that that that would lease an apartment from us uh and then do that on their own, but we've we've uh essentially um restricted that within our portfolio.
>> Yeah. Thank you. >> Uh slide 14. And we've so we're a diversified fund. We've got a little little bit in in everything. Um, we office is the property type that's been in the news and certainly been the the worst performing property type over the
past couple years since since COVID the onset of COVID. Um, we've actually been bringing, you know, office in this portfolio down. Back in 2015, we were 47% of the portfolio was invested in office and we brought that down to a meaningful underweight today. And most
of that office was sold precoid. So, we sold over $3 billion precoid um out of our office portfolio. The office that we have left is very high quality um leased to to to good tenants and that's really benefiting from what's happening now is a real
flight. There's still issues within the office market in general, whether it be work from home or reductions um in corporate u uh payrolls, but um the the office we have is actually performing pretty well right now. uh it's been written down uh office and our portfolio
is written down about 48% from peak values since if you take the if you call uh December of 2019 peak values for office we're down about 48% so the the office write downs have been taken and actually office is performing the high
quality office is actually performing pretty well we're doing you know new leases property picture there it says Anaheim but it's really Irvine California and Orange County we've got a large property there that's leased to Western Digital and Panasonic, our largest tenants. And we're actually um
negotiating with a large um food national uh or really global food company right now to uh uh to occupy some some remaining vacancy in that sp so it's really emblematic of what's happening in the in the office space is just the the quality buildings are
getting the leases and um you know catching the the eye of investors as well. We don't have any investments in some of the hardest hit markets like San Francisco or New York. We've sold out of all those markets and we're really in those growth markets. Our largest office buildings in Austin, Texas, we have a
building leased to Google. Uh we have the best building downtown Austin, Texas and 70% of it's leased to Google and we have Deote and um CBRE and number other tenants there. that uh well well leased, well occupied, and we're really getting some of the highest rents uh that we've
ever gotten in those buildings. Got another building in Washington DC where Amazon's our largest tenant. We're about a block from the US capital and Amazon does all of their lobbying of the federal government out of our building. And so very strong, you know, again, we're signing high the highest lease rents we've ever owned or ever signed
since we've owned that building. So very strong strong demand for those high quality office buildings. Uh, you know, office is has kind of been in the barrel the past couple years. The you retail probably 10 years ago, retail was kind of in the same spot. Offices in
um retail is actually doing very well right now. We're actually closing on a new retail center uh the first week of December. And so retails uh we're seeing good good growth in rental uh rates as well as strong tenant demand. kind of retail we own in this portfolio and have
always owned is really necessity based or grocery anchored retail. We don't have any malls. You can see about a third of the benchmark, 32% is still invested in malls. And so we've never owned them all and we we're never going to own them all, but the, you know, we'll continue to add the kind of retail
that we like and have been very successful with um the those grocery anchorage centers. And some of the the most interesting opportunities are coming from outside of those four core property types. Uh we've got an uh allocation to data centers.
It's been the best performing part of our portfolio the past couple years. Uh we've got a 4% allocation to data centers. very strong tenant demand. We just signed a a in in the third quarter. We just signed a lease with a um a data center user. We've got a uh property
pictured there is in in Plano, Texas in Dallas. Leased a company called Coreweave that's been in the financial news. They went public in the second quarter. Um so very very strong tenant demand there um within that part of the portfolio. >> Any data centers in Northeast Florida?
>> Not in Northeast Florida. We have a a a data center in Sunrise um in West Broward County. Um so that'd be the closest data center that we have here. It's at least a large one of the large uh cell phone companies. It's kind of their operational center um out of West Broward.
>> Thank you. >> We've got probably the thing our team is most excited about is our NOI growth on slide 18 and 19. We just detailed that. We've been able to grow our our income at a rate of about twice the benchmark. Uh so we've grown our income almost 6%
in this portfolio over the last 10 years annually. You can see we had a setback in 24. Actually we we took a year of free rent from one of our largest tenants in exchange for eight years of additional lease term in our uh office portfolio. By doing that uh you know we
were only able to do that because we've got a strong balance sheet and we could go without that income. But we were able to get uh some lease term that made that building financable and um and salailable. And so we actually sold that building in the second quarter. We went for a year of free rent uh in 24 and we
sold that building in second quarter of 25 this year. So uh um that was a very int our NOI growth would be a lot better if we wouldn't have taken that um uh given that tenant free rent, but that was an important good long-term deal that we're able to do because we've got
a strong balance sheet for the portfolio. So, but we've got some very good opportunities to grow our income going forward. Slide uh 20 highlights our debt within the portfolio. We don't have a lot of debt, but as I mentioned, we're a low leverage real estate strategy, and our
average cost of debt is 408. Obviously, well below what you can get for for borrowing today. It's about 50 basis points lower or a half a percent lower than than um the the benchmark. And so it might not sound like a lot, but on two and a half billion dollars worth of
debt, it's it's significant and it's uh we think it's a competitive advantage going forward as well. Performance pretty self-explanatory there, but um we're exceeding the benchmark over all time periods for total return and income return.
And then on slide 22, we we show a data center, another data center property. And then on slide 24, we just have some a summary of account terms. We've got, you know, as I mentioned, daily liquidity on this. We've been, uh, this fund's been in existence on open-end basis since 1992.
Um, we've got, uh, you know, a number of other investors such as yourselves in the fund. Our minimum investments a million dollars and we can take that. You can again call us tomorrow and say you want money out or you can call us and say, "Hey, we want to put money in tomorrow." We by striking that daily net
asset value, we're able to accommodate. Um it's a feature that a lot of our investors um really really value. >> Yeah. Part of that flexibility I want to mention as you all are getting out of another fund that Brent mentioned with JP Morgan we have the flexibility to accept some capital now and as as that comes in as you get 5% to quarter or
whatever it may be we can accept that capital as it comes. So that's that's part of the flexibility where we think is a benefit. I know we're about out of time here, so I'll probably uh look to wrap it up, but I you know, we uh we're very excited the way the fund is positioned today. We
went for a couple years without calling capital in this fund until we uh until the net asset value had adjusted down to the current market pricing. And so at this point, we're we're we're very optimistic about where the fund's going and how it's positioned today. We've got our overweights to the right sectors.
We've got a strong balance sheet. We've got a consistent team in place. Uh as well as we think it's a great opportunity to buy into a high quality portfolio that's been repositioned and repriced for the current uh market environment. Got a lot more information
in here. Uh our 10 largest uh properties uh pictures and maps as well as a bunch of other stats of uh including every property in the fund. So we're very uh very transparent about the fund operations and about what we're invested in here. So >> can I ask a question?
>> Sure. We can go back to number 16 on data centers. Uh if you're if you're watching the stock market the last few days, all these guys, Nvidia, Microsoft, they're all trying to out billion dollar each other. And now the market's concerned about how you going to pay for that. I
know several of them have a lot of money, but they're going to create a lot of debt. And is it going to be what's going to happen there? The data centers are building them on every corner like Starbucks now. So what's going to happen there?
>> We're we're still ste Yeah, we we we've read the headlines about the stock market as well. I mean there we continue to see strong demand from the users uh at the data center. And if anything, there's pent-up demand that probably hasn't been able to be met just ba based on the constraints of of power and a lot
of the components that go into these data centers, whether it be uh you know chillers or or cooling equipment or backup power. um all that kind of stuff. There's been huge backlogs with all that uh equipment that goes into the data
center um including just limits on power um you know so we would expect a lot of the the froth to come around so off some of those fringe areas as well. Well, um, yeah, there's there's I think a bunch of money being raised around
that, you know. So, this property we've got here in in Plano, we actually are looking to expand the power. We talked about this in the meeting earlier, but we've identified 14 megawws with from that the power company in Dallas, Encore, can provide our facility. We have all the power we need that we're
contractually obligated to provide, but our partner has identified 14 megawatts that the that the utility Encore could provide us. It's capacity they have in the the neighborhood that's served by the the substation uh that's not being used by by any other users. So, they're
they're looking to redirect that to our property. So, we have a lot of expertise in this space to to kind of get a lot of that power redirected to us and we can we can either lease that to our current tenant or we can lease out to to another tenant, bring another tenant to the building. But power is is a real
constraint. It's and it's not only power, but it's all the it's the backup power and the cooling power and the switch gear. Switch gear has been backordered for years. Um, and so it's it's not just power, it's all the equipment that goes along with it. And so,
>> but you're right, there are big shortages there. Um, >> yeah, I I live in De Mo, Iowa, and and actually Google just bought the only nuclear power plant in Iowa. Uh, it's been, I think, offline, but they Google just swooped in and bought a nuclear power plant in the middle of nowhere in
Iowa that nobody knew existed. So, it's happening. Yeah. >> Any other questions? Well, thank you all for for the time and if we're fortunate enough to earn your business, we we appreciate the opportunity here today. Thank you. >> Yeah. Thanks.
All right. Well, good afternoon uh everybody uh Mr. Chairman, members of the board. Very nice to be here. Thank you for inviting us down uh to present Smart Markets Fund to you today. Uh my name is Cormick Doy. I am a senior vice president in our client relations team
at Stockbridge. I'm joined by Chris Owens who's a vice president and associate portfolio manager on on the portfolio team. Um so thrilled to be here. Um you know over the next 20 minutes or so Chris is going to talk you
through some of the key features and benefits of the smart markets fund. It is one of the top performing funds in the nrief Odyssey index. Um, one of the benefits that you'll hear from Chris talk about is the funds income returns.
It does have the highest uh income return in the index over the trailing 10 years uh and historically has has been able to outperform uh the the indexes income returns since inception of the fund in 2011. So you'll hear about that
and lots more. Um but first I'd love to talk to you a little bit about our company. Uh so if you'd like to open up on page eight of the presentation. Um so Stockbridge was founded 23 years ago by Terry Fer. He's still our CEO
today. Um we you know when Terry started the company back in um you know all those years ago we had a handful of clients and about 800 million under management. And today, fast forward 23 years, we have over 150 institutional
investors invested in our platform. Um, and we're really thrilled to have gained the trust of so many of those clients over the years that have continued to invest with us. Um, and on behalf of those clients, we managed 36.5 billion dollars of real estate across the US
today. Um, so that's really only possible with the trust of our clients. 45% of those are public pension plans just like Jacksonville Beach Retirement System. Um and in smart markets fund 68% of of our clients are public pension
plans. So you know um we take our role as a fiduciary very seriously and uh you know we aim to to strive to really be uh good stewards of your capital. So just looking across an overview of Stockbridge, 200 employees spread pretty
evenly across the US in our six offices. Uh we invest in pretty much every major metro across the US. Uh we take a very boots on the ground approach to investing. You know, real estate is a very local game and uh and so we have
experts in our offices that cover uh markets and uh you know, have a very uh local presence. We are a diversified manager. So we invest in the four main property types, residential, industrial, office, and retail. Within those sectors, we have
sub- sector specializations. And you'll hear more about those as as we work through the presentation today. Um, and uh, lastly, we invest across the risk spectrum. So from core, core plus, value ad, and opportunistic.
You know, in the interest of time, I'll skip over page nine, but you'll see a history of our firm's growth. Smart Markets Fund has really been integral to the success and growth of the firm launched in uh 2011. Um
lastly, I would just uh invite you to turn to page 12 and I'll just um briefly touch on the firm's uh the funds investment committee. Um so the fund is uh governed by a very
seasoned investment committee made up of 12 members. Uh that includes the the fund's portfolio manager M Johnson um and Tuba Malinowski who was actually the um the the founder of Smart Markets Fund. Tuba launched the fund in 2011 and
she's still on the investment committee today. Um, you know, uh, I would just say, you know, very, um, seasoned team of of folks overseeing the Smart Markets Fund in the investment committee. No senior level turnover, uh, on the IC in
the last five years. Dan Weaver at the bottom right, um, he heads up our Chicago acquisitions team. After 40-year career, he's preparing to retire at the end of this year, and we've introduced Brian Bill and Tom Gruski onto the investment committee. um uh but uh
otherwise very stable uh and and uh experienced team on the on the IC. So I'll pause there in case of any questions on the firm. If not, we'll jump straight into the fund uh on page 13 introducing the fund's team. Um as as
I said, M Johnson is the portfolio manager. Mack has been with the firm for 11 years working on the fund all of that time dedicated to the smart markets fund. Uh the growth and the success of the fund um is really uh a large part in in in part to Mac's role in in growing
the fund. Um working very closely alongside Mac is Chris Owens who's been working on the fund for eight years now. Um Chris specializes in transactions and oversees our valuation process. Um, also working alongside Mac and Chris, we have
Megan Finerin. Recently joined the team as head of portfolio operations and Megan brings a deep uh expertise in asset management and uh specializes in multif family asset management as well. So um great to have Megan as part of the
team and then we have an associate and an analyst. So, you know, I would just say very stable and experienced um folks running the Smart Markets Fund that have been working together for for quite a long time. Um the fund also benefits
from a deep bench of transactions and asset management professionals working at the firm. 21 investment professionals sourcing deals for the smart markets fund. 31 investment professionals working on the asset management side
executing on the funds business plans. Um so with that um Chris anything that you would add on the team? >> No that was great Cormarmac. Um thanks I would just add that you know with with Mac with over 10 years of experience. I've worked with Mac for my eight years at Stockbridge uh with Tuba still being
on our investment committee. I think that continuity across our team has really benefited us. We'll talk about the original strategy the fund had at its inception by keeping you know that team intact. I think we've been able to continue to carry out that strategy. You know, sometimes when you get a new PM team to come in, certain funds, they
want to change things up. It can be detrimental. I think we've had the benefit of that continuity over the years, which has been part of the reason for our outperformance. But with that, I'll uh we'll get into the fund uh story and we'll move on to 14. Uh and I and I'll try to get through this relatively quickly in the interest of time. So, the
Smart Markets Fund uh it was launched in late 2011. We sit at just under five billion in gross asset value. Today uh we are nearly 93% occupied. You'll hear me talk quite a bit about how important occupancy cash flow the income return outperformance is for our fund. We have
a relatively limited non-core exposure at 5% today. So we want to own assets that are you know well occupied the cash flow and and return you know income uh through a distribution to our to our clients. Where does the name smart markets come from? The original kind of
market selection strategy for the fund uh was that we would target markets that had a higher percentage of bachelor and graduate degrees and that for a a market that has a more educated uh workforce that would ultimately drive uh jobs to
come to those markets and then jobs in particular in industries like technology, healthcare, finance, energy etc. um and that you know with job growth in those certain sectors that do pay well uh there would be a high correlation to real estate outperformance within those markets. So that was the original strategy that's
where the name comes from. That's still a major part of our market selection today. Moving on to 15, the fund's competitive advantage relative to some of our peers in the index. Uh we'll talk quite a bit about our liquidity position today. Uh the fund does not have a redemption queue. We have not had one since January
of this year when we paid it off in full. Uh we've had quite a bit of success raising capital over the last 12 months or so over $700 million in commitments. Um and we our commitment Q as of 930 was $241 million. We are expecting a sizable capital call in
January. That'll get us down to around $113 million in uh in dry powder. But that's given us the ability to not only return capital uh to our clients uh when they've asked for it through redemption requests, which we feel like is our obligation when we're able to do so, but it's also given us ample dry powder to
take advantage of buying opportunities and what's been a pretty attractive acquisition market over the last uh year or so. Uh Cormack hit on the the gross income story. Again, the top performing income return across Odyssey over the last 10 years. Our income return over the trailing one year was nearly 5%
which is 86 basis points higher than the index. Um and then briefly hitting on our property type and market exposures. We're a low office fund have always been a low office fund from the fund's inception. That's 5% of our fund today. Uh and you'll you'll hear us talk about
having a an overweight to the southeast in particular. I sit in Atlanta. Most of our uh fund team sits in Atlanta and we have good relationships throughout the southeast. you know, Nashville, Carolas, Atlanta, Florida as well. So, that's always been a point of emphasis for the fund has been and has been a benefit uh
from a return perspective as well in recent years. Moving on to 16, we have a a chart here that shows the fund's redemption uh redemptions as a percentage of our net asset value dating back to 2022. So, that's the the green line, the blue line
is the Odyssey uh weighted average across the entire index. And so you'll see that, you know, as I said earlier, since January, we have not had a redemption queue. Odyssey, as of June 30, sits at 14% of net asset value. So again, you know, we we were able to raise some capital to help pay that down. We also made the effort to sell
investments to return that that capital to our clients, but ultimately uh that's that's freed up our ability for the capital that we have raised as of late to go take advantage of an acquisition market. Uh that's pretty attractive. In terms of uh fund performance on page 17, really good outperformance over
across all time periods. We are a top three fund within Odyssey across the one, three, five, and 10 year uh period. Uh 187 basis points over the one year, roughly 300 basis points over the three and five, and over 200 basis points on the 10 year. So really good
outperformance over all those time periods. I'll talk on the next slide about the income story. That's been a big a big part of of that outperformance. So moving on to 18. Uh this shows the funds uh gross income return on a
quarterly basis uh dating back to 2022. So the blue line is smart markets funds gross income return. The green line is is the Odyssey value average for the income return. Uh we've actually outperformed in every single quarter. That's 55 quarters uh since the fund was
launched in 2011 when it comes to our gross income return. So that's a big point of emphasis for our fund team and how we manage the fund. you know, what we buy, what we sell, what we finance, uh, when we make leasing decisions is trying to, um, you know, emphasize that income return out performance. Um, you
know, in the interest rate environment that we're in today, we expect interest rates to stay relatively steady. Maybe a couple rate cuts coming up in the relatively near future, but we don't expect a return to a near zero uh interest rate environment like we were in coming out of the pandemic. Income is likely to be uh, you know, the major
driver of of return performance over the long over the long term. If you look at uh commercial real estate performance dating back to the late 70s, early 80s, over 70% of total real estate returns come from income. So we feel like having this income return out performance
really gives us a leg up uh relative to to our competition where we're not so reliant on appreciation to drive those returns. >> So since inception in 2011, I see from 22 to 25 in this chart. Can you just give us just a super brief overview of
what 2011 to 20 2022 looked like? >> It was sim it's similar. So on an average dating back to the funds inception, we have 23 basis points of outperformance each quarter. So that's the average spread. It would just look very messy if I showed all the way back to 2011 on this slide. So, we showed the more recent window, but actually, you
know, larger outperformance kind of more in the ballpark of where we've been over the last year or so, where you see kind of uh 25 basis points uh in two quarters ago, 27 basis points a few quarters ago. It averages 23 over the long term. >> Okay, thank you.
And again, uh 496 is the the trailing uh year gross income return, which we feel like is is a meaningful spread at 86 basis points and near 5% a gross income return relative to kind of where the Treasury sits today. Uh feels pretty good. So, moving on to page 20, uh the smart
markets. I talked a little bit about kind of the market selection strategy. These are the 19 uh target markets, the smart markets. Uh they've largely been the same since the funds launched in in 2011. We've added a couple markets. Um, but again, they've largely been the same. Charleston, Phoenix in particular
with two additions in recent years. Um, in terms of where we're overweight relative to the Odyssey index, you'll notice the Southeast, all these green dots are where we're overweight to to the index. Again, with our team being based in Atlanta, having relationships uh throughout the Southeast, we were early adopters of investing in mar in
markets like a Raleigh, a Charlotte and Nashville, etc. Um, and certainly coming out of the pandemic with folks relocating for jobs or for quality of life down to the southeast, that's been a big benefit to us. We also have a meaningful exposure to the West Coast. Our headquarters is in San Francisco. We have very good relationships in the Bay
Area and Los Angeles in particular. Um, so we continue to to, you know, lean into those markets as well. Where do we look different in the Odyssey Index? We we don't own a lot in the Northeast or the Midwest. New York would probably be the largest outlier where we only have one multif family investment. And you'll notice in some of the larger Odyssey
funds, they have very meaningful exposures to New York. So that's been a benefit to us uh from a return perspective. On 21, uh the diversification by property type, I'll kind of uh talk about where we are relative to the index and also relative to our internal
targets. The fund has been overweight to the industrial sector uh really since the early days of the fund. Um, and so that's been a benefit to us is if you looked at where Odyssey has gone from five years ago to today, that number was kind of high teens industrial exposure, low 20s. To get all the way to 34%,
there's been quite a bit of buying activity throughout across many of our peers in the industrial sector at a time when industrial is very expensive. We've had that overweight and we've actually been net sellers of industrial over the last five years or so into a pretty overheated market. Um, so we've been able to maintain that overweight really
mostly through how well it's performed, through appreciation of our existing assets. Um, but we're very comfortable at 40% today. Uh, feel like that's a good good position to be and we'll likely maintain that overweight going forward. Residential, uh, we have a slight underweight today. I think that
that's our main target on a go forward basis in terms of buying. Uh, we feel like there's a shortage of housing in this country and long term there's going to be a demand for investment in that space. We're particularly interested in the affordable space um and the affordable housing space. So that is what we're utilizing a lot of our um dry
powder that we have today that the equity we have available today is in the residential space and would hope to be more in line with Odyssey in a year or two. Retail we are we have the largest retail exposure uh within Odyssey. Uh but what what we own in the retail sector uh is almost all grocery anchored
retail. We do not own any malls. Uh and so that's really performed quite well for us. We've always had a retail overweight, but we have leaned into that story quite a bit over the last couple of years. And the retail sector has been the best performing property type within Odyssey over the last couple of years. So, um, the grocery anchor product, you
know, that would be public centers, Harris Ters, Whole Foods, Trader Joe's, etc. Almost all throughout the Southeast, we have a public anchorage center here um, closer to downtown in Jacksonville. And, uh, there's been very little new construction. It's very difficult to build retail today. our
tenants have pretty limited options in terms of where they can go. So, the retention rates stay high. We're able to move those rents. Uh, and it's been a very good story from an income perspective. So, um, that's a story that we've leaned into. And retail has really benefited us, but again, no no mall exposure, which differs a little bit from some of our peers in the index.
We're a low office fund, 5% today. It's on the low end of our target range. I don't really see us uh moving that number materially though in the near term. >> Have you have you dabbled in data centers or energy? >> We have not. uh we you know we're evaluating those basis but feel like um
M Johnson who runs the fund actually previously worked in the data center space. I think he feels like it's a better development strategy than it is a core buying strategy and with the amount of equity required it would be such a it would require such a large percentage from a diversification perspective to get into the data center space. We just
don't really feel like that makes makes sense for our fun. >> Under your residential are you seeing more rental? It's harder to get hard to get loans. you know, people are 40 years old now when they're buying a house instead of 22. >> Yeah, there's certainly uh yeah, there's
been an increase in the percentage of of renters in this country. Uh which is I think part of the reason why we like that space. Um there's been you know a good amount of supply in recent new construction and in recent years all that's dropped off but yes the our retention levels within our for example our apartment buildings that we own has
been very high um because we're not seeing the sort of moveouts to buy homes that we used to see which is part of the reason why we like kind of increasing that allocation going forward. Uh you'll have to see interest rates drop materially or home prices drop materially and neither of those are happening. Um, so it could happen, but
uh interest rates are probably more likely. I think it's possible. >> I I I don't foresee it in the in the near future. >> And then our our other exposure is one life science campus that's in the Bay Area that's leased to a company called Exile Alexis. That's a drug discovery
company. Uh they focus on kidney cancer treatment. It's a public uh company, good investment, grade credit, long lease terms, so a very safe investment. But that's our one kind of other investment. briefly on 22. Kind of the point here is to illustrate, you know, I talked about being overweight to industrial from the
beginning. This only dates back to 2018, but the story would hold true if we went all the way back to 2012. The dark blue bar is industrial. Again, we've been over 30% dating back to that point in time. Um, I would also highlight uh with the light green bar with office, we made the decision to sell out of sell out of
some office kind of really before the bottom fell out of the office market. Um, you know, the pandemic obviously had quite a negative impact on on the office market. we were able to exit some of those investments. So, we saw maybe some risk coming with the individual assets. Um, and so that's been to our benefit as well. The other thing that I would
highlight is, you know, we raised quite a bit of capital coming out of the pandemic. We're able to do some offmarket investments, whether that's our life science investment I just spoke to, which is number four, uh, a grocery anchored recap and which is number six. Buy those offmarket, buy those at higher cap rates, continue to enhance our
income return. uh and it kind of we call that our relative value perspective. Rather than going and buying super low cap rate multif family industrial deals, we looked at offmarket opportunities that would enhance our income return. That's what we're doing now as we raise capital as well um to continue to emphasize that income return.
24 and 25 uh show some of what we've been able to do with the capital that we've raised this year. uh we focused on buying 100% leased investments very core investments longer lease term uh good annual escalations you know at inflation or above uh and accretive uh year one
yield so that means accretive income returns relative to where the fund's income return sits so we've been able to do that through four long-term lease industrial opportunities retail opportunities um we noticed that again there's not a lot of core competition most Aussie funds are kind of strapped
for liquidity with redemption cues so we notice a hole in the market for uh you know long-term lease industrial opportunities earlier this year. With that less competition, we're able to get you know some higher cap rate pricing uh that's been you know an enhancer for our funds income returning and and and and
you know newer builds uh very core in nature. Same thing in the retail space. We've got an HB Anchorage Center in a wealthy pocket of Houston. We've been trying to get an HB for quite some time. They don't trade very often. That's the prominent ger in in Houston and also in Boca Raton. Uh our first investment in
the retail space for our fund was in Bocarone back in 2012. It's a publiclix anchored center. We really like the market. There was an opportunity to buy newly developed center here anchored by Whole Foods. Also has an REI Lifetime Fitness Home Sense, which is an offshoot of of Homegoods. Um and these were both,
you know, at a creative cap rates, newly delivered deals. Um longer lease term, very core investments, very safe investments, um that that will enhance our income return going forward. And then uh on 26 wanted to briefly hit on our leverage strategy. You know,
we're a relatively low le leverage fund just like our uh you know competitors in Odyssey. We sit at 22% loan to value today. That's a comfortable spot for us. I think we'd probably like to be more in the 25% range long term. So we have the opportunity to take on some additional leverage uh with interest rates coming
in a little bit more recently. There's quite a bit of lender interest that's made uh those spreads a little bit more attractive. I think we'll have the opportunity to secure some interesting financing going forward. The one thing I would point to is we've been able to keep our weighted average cost of debt quite a bit lower than our peers, which
really benefits our income return. We did that by locking in kind of long-term fixed rate debt, meaning that that interest rate was fixed for a a certain period of time, five, seven, 10 years. Uh when rates were lower, you know, three to five years ago. And so that 4.3% weighted average cost of debt is
materially lower than than most of our peers. So a pretty safe strategy, low leverage strategy. We don't really have any upcoming maturities that are an issue. We expect to be able to refinance those over the next couple of years. Uh, of course, if we did need to pay them down, we have the liquidity on hand to do so. So, that's where that liquidity
position really helps us. Um, how am I doing on time? I can >> pretty close. >> We're getting pretty close. Uh, should I turn it over for questions or or keep going or um >> Okay. Um well I can you know get through the portfolio a little bit just give you
kind of a a high level picture of what we do own. Moving on to the industrial portfolio. You'll see it's pretty well diversified across the country. Um you know over five years of lease term very core in nature. Uh but we like the diversification we have across all these markets. Again quite a bit of
investments and that's how we have that 40% waiting. Uh residential same thing. It's uh you know we sit at at at over 90% occupied today. Of course, we would like to continue to increase that exposure, but well diversified across the country. Um, and that that's really
our goal. I think, you know, we've evaluated other residential sectors like student housing for for example, um, possibly age restricted uh, multif family, but it's it's always going to require a very interesting opportunity uh, for us to take, you know, a step
outside of what we traditionally do, which is mainly invest in the main four property types that we know quite well. And then I've got, you know, brief summaries on the other sectors as well. The retail portfolio, which I mentioned earlier, uh, is predominantly in the southeast. That's mostly grocery centers
throughout the southeast. Uh, again, investing in those growth markets where people are moving to. Um, we feel like is a very a very sound investment strategy. And then with our office portfolio, it's pretty limited in terms of what we do own. There's the life science investment in in the Bay Area, but other than that, it's mostly um it's
mostly in the southeast, which is the south southeastern office markets have fared better than what we call our gateway markets, the the New Yorks, the um Chicago, San Francisco of the world. Um so, uh the office uh even though we've been a low office fund really since the fund's inception, uh what we
do own in the office sector has materially outperformed our peer set, which has helped from a a return perspective. And then we've got, you know, some information on on the fund at a high level, our our our key fund terms. But, uh, I think that that really really wraps it up. We can can take any
questions. >> You mentioned there's an entrance queue. Um, just kind of based on what what you know today, you know, if the if the funds were to make a commitment, what would be your anticipated timeline and and kind of percentage of that money being called in?
>> Yes. So we have a again so following our January capital call that queue will get down to $113 million. So we have an idea of what January looks like. It's dependent on deal flow but I think you know I will say we have other uh you know searches that are ongoing but if you were to get into the queue today I
think there is a a decent chance that some of that capital could be called in April. If not in April it would likely be July. So I would say um you know really one to two quarters. uh we certain certainly you know not in January we have that that number locked in at this point but uh you know e
either April or July >> and you know we we um often get asked about timing of capital flows you know capital calls for clients coming into the fund. It's a common question now with challenges with liquidity coming back to to to investors like like
yourselves. Um, and so we're, you know, happy to work with you guys to help you time, you know, find the right time to come into the fund if you were to choose to to to invest in Smart Markets Fund. There's a couple of ways that we can think about that with you. Um, one is that we can, you know, prepare
documents. If you know, if you weren't able to commit all of your capital at at at one time, we could have the documents prepared and then wait until you had that commitment ready to fund and we could sign the documents, put you in the queue at that point and we can give you visibility around how long the queue is
and if you know if the queue is getting longer, we can let you know. The other option would be to do a phase commitment so that you could you know sign a commitment of a smaller amount than you were you know initially anticipating. um and whatever you're ready to to to
commit at at this time and then follow on with an additional commitment later when you're ready to fund that. So, and that's a simple one-page addendum to your um original subscription document. So, um happy to help and work with you
on that. Any other questions that we can help to answer? Well, we really appreciate your time today. You know, we hope to win your business. And uh, you know, I just say as you evaluate your options today, hopefully you remember the Smart Markets Fund is um, you know, we've had good
long-term outperformance, good stable, experienced team running the fund um, you know, and um, consistent uh, outperformance. So, we'll leave it at that. Thank you very much for your time. Yeah, appreciate it. Thank you.
head up to Thank you. Perfect. >> So, we'll go ahead and just kind of turn the floor over to you. Please uh go ahead and jump right in. >> Yeah. Thanks so much for having us. Uh 20 minutes or so. Okay. Uh I'm Brian
McDonald. I'm a member of the uh investor relations team at TA Realy. This is Jake Mal. He's the uh PM for our core fund. So, uh, really appreciate you having us on today. Um, I'll I'll give a quick intro to the firm and then Jake can run through our core
fund. Um, slides seven and eight, our brief intros. Um, so TA Realy, we've been around since, uh, 1982. Uh, all we do is private US real estate investing. Um, we're a partner owned firm. Uh,
super long 10ear partnership. uh they average about 19 to 20 uh years together as partners at TA. Uh low turnover firm, really good uh really strong culture up in Boston. Um you can see here we're one of the largest uh buyers and sellers of
industrial real estate uh in the US. Um we have been since our early days in the 80s. Um and we've expanded our team. So you can see here uh we have about 130 professionals across the US. Uh Jake and I are in Boston. Uh 90 or so of us are
in Boston. Um we have asset management and uh acquisitions in Newport Beach as well as Dallas. Uh small investor relations office in San Francisco. And then we recently launched our uh data center uh development team in Ashurn,
Virginia, which is the largest uh data center market in the world. Uh so you can see here 27 partners uh 19 years together and then just briefly on the platform here. So on uh page nine so we're about 19 billion uh in assets
under management today. Um two kind of themes across the platform super low leverage low LTV firm uh conservative uh debt profile and low uh allocation office about 4% office um across the entire 19 billion. Uh we kind of have
two staples of the firm. Uh today we have Jake's core fund about eight billion in assets on the left side and then we have our value ad fund series. Um this has been uh since inception of the firm it's been uh kind of the ballast of our uh of our firm when we're
currently uh in market with fund 14 uh in that fund series. So Jake maybe uh Jake can intro himself and uh dig into the core fun. >> All right. Um so good afternoon again. Thanks for your time here today. Um, as Brian mentioned, my name is Jake Maliel, um, a partner at Tia Realy in Boston.
Together with my other colleague, Sean Rubman, we're the two, uh, portfolio managers who lead this core fund and we have since the beginning, um, which we launched it about eight years ago. So, he and I, Sean and I work together leading this fund, and we have since the inception. There's a lot of continuity there, which we think is really
important for core open-ended funds. Um, and we'll talk about the sort of uh, sort of the nuts and bolts of the fund here moving forward. Um before we do I think you know core open end funds there's really five things we think are really important you have to do not any one of those is more important than the other but they're all important over
time number one pick the right property types and the right markets sounds basic but that that you think are poised for tomorrow's growth not yesterday's growth um and and then two is then allocate your fund accordingly that's the work of the acquisitions team if you think okay Atlanta industrial the southeast
southwest whatever your strategy is that's one thing macro level but then you got to go out and actually find deals that fit that strategy. So that's the second thing. Third thing, and this is a big flaw in the core space, I will say, is you're typically buying stabilized assets. So, you know, things that are well leased already. Um, and so
it can breed some laxidasical behavior among your asset management teams at these shops like us. Um, you can't accept that. You got to have asset managers that are looking at these buildings saying, "Okay, even if they're 100% leased because they're core and stabilized, I got to go inside. I want to have, you know, regular meetings with
my tenants, understand how their business is going. Industrial warehouse, are they growing? Are they contracting? Do they need more space? Whatever might be the case underneath the hood. So, you have to have an engaged asset management team. You can't just collect the rents every quarter and say, "Okay, uh, everything's going to look good because the rent came in." So, really work in
the cash flows aggressively, talking to your tenants. Fourth thing, managing risks. Risks come in all shapes and sizes. You know, this fund is now eight years old, so we sort of lived through the sort of the pandemic period. we've lived after that and obviously in the debt hiking cycle puts different
pressures on your funds over time. So you have to manage those risks. That's the fourth thing. And the fifth is you have to sell assets before they become uncompetitive. That's a major flaw in the space because it's open-ended. People always just started thinking about growing for the sake of growing, forgetting that like anything else,
there's a couple assets, couple things that we'd like to clean up over time or get rid of. And if you aren't prudent about that, you're left holding assets in a future market. and trying to explain why they belong in your core fund. I talked about picking the right property types and markets. So, it's
kind of a joke, but I grew up in New Jersey. Um, we're a big mall state in New Jersey. That's what New Jersey was known for, but if you still owned a lot of malls in New Jersey, these core funds today, you'd be really upset with your return profile. They might have done really well at at a different time, but things have shifted. So, you got to be
able to continue to move these allocations over time to drive that out performance. For us, that's the five things we think about all the time. And if you do those things, you can outperform your benchmark which is the it's called the Odyssey benchmark. The Odyssey is the benchmark of 25 funds um
who all submit their data and it creates like an index and you can kind of compare when you compare our fund um over this eight almost eight years we've been active or since inception. We're the number one, two or three fund in the three year, fiveyear, seven year and since inception time frames because
we're doing these individual things. It's like small ball baseball. You got to do all of those things to try to drive the outperformance. It's not one singular deal that's going to bring you home. So the fund itself, and I'm going to go to page 14 here, is an eight and a half billion dollar fund today. Um, >> can I grab you before we Yes, please.
Yeah. >> Um, so you have a dedicated digital group focused on data center research or operations. Do you have assets in in data centers? >> We we do as a firm. So out So let me be clear. We have a big data center initiative within the firm. Okay.
outside of the fund. And within our fund, we have one investment that we just made this last uh quarter in Northern Virginia. So, it's we could talk about it's a data center asset in Northern Virginia. Um I'm actually going there tomorrow. A bunch of our investors are coming to town to tour the asset with us um tomorrow. So, we do have one
data center investment. >> Anything in energy? >> Say it again. >> Anything in energy? >> Nothing in energy specifically? No. >> Like like nuclear plants or >> No. No. Nothing like that. No. No. >> All right. Thank you. >> The energy is it's electrical engineer. It's it's electric and it's being driven
by Dominion Energy which is the major energy provider for the Northern Virginia um subm market. So yeah um so uh eight and a half billion dollar fund this is on page 14 um leverage use
of debt relatively low 25.9 so let's just say 26% which is to be expected in the core kind of execution uh occupancy 94% so pretty well occupied portfolio which which is sort of a good health ratio to have a decent occupancy
good starting point um and a couple of things I'll point to is our capital flow flows entrance queue. We actually have um a nice little entrance queue that's built up. So really proud about that. It's a sign of different investors across the US and across the globe committing to the fund. Um so we've raised we have an entrance Q77 million
today. Um if you go back over the last four quarters, we raised about $700 million to the fund. So it's been really good acceptance in the broader investor community about um the fund when they've looked at core. We're really happy about that. The flip side of that is the redemption queue. We're at zero. And I
think again that's an important thing. We we cleared our queue. There's 282 investors in our fund as you see in the below. Um both Sean and I as I mentioned we launched this front from the beginning. Every single one of those investors we've come to meetings like this and talked to right and understood what their interests are, what the the
beneficiaries that they're trying to support are. Um and it's important that every single one of those investors Sean and I have spent time with and helped on board and sort of um you know have clients in the fund. The reason that's important is that when situations happen like we've had the last couple years,
debt hiking cycle is uh upon us, values come down, redemptions pile up across the space. So nobody was immune from that. One of the things we thought that you know we you can't escape the fact that we've come to these meetings, we've pitched this fund as an open-ended fund. It should be open not just for when the
money's coming in, but when the money needs to go out. It's ultimately your investor's capital, not ours. And so what we said to ourselves at the time is our performance was strong in terms of like the returns, but we actually thought we'd be measured more on our ability to provide liquidity to our investors throughout that downturn. And
so for that two and a half year period, we never had a single quarter. We didn't pay any redemptions. We always paid some like 10, 15, 20%. And uh and we cleared our entire queue. We re we received roughly a billion dollars in redemption requests. So it's not like we got nothing. We got a billion dollars during
that time. We paid it all out. And so I think this is part of that kind of day-to-day blocking and tackling of running a portfolio like this open-end funds. It's not easy, but it's the sort of day-to-day decisions you make that you have to live with over long periods of time. >> Jake, if I can talk just a quick second. You mentioned the the entrance queue of
177 million. >> Based on what you know today, >> if they were to make a commitment, how long would you expect it to take to to have that money called in given the fact that there's an entrance queue? Yeah, we are um basically calling capital within one quarter of the commitment date. So
for many investors, Brendan, it's u I think folks have um go through their own process to determine when they want to make these commitments, but then they don't want to be hanging out in cues for a long period of time. Um so we understand that having that capital called is also important. Um so we're we're operating on a one quarter basis
essentially from the time the commitment gets made to when the capital will get called. >> Okay. uh our minimum like uh a million bucks. >> Yeah. Yeah. Yeah. Um so I'll just quickly touch on um I'll
skip a page and just go to page 17 if you if you could. Um middle this is the first bullet that I talked about. You got to pick the right property types and markets. So the middle bar chart property type diversification. This just shows how we stack up compared
to the Odyssey index. Remember that's that benchmark of the other of all the funds in the space. Couple things you'll see uh starting from the bottom in dark blue industrial 43% for us benchmark 34. So a nice little overweight to industrial light blue multif family. So
apartment communities around the United States 37% to 30 for us. We look at those two things roughly equal weight. So just call it 40 40 80% total in industrial multif family. They might bounce around a little bit. 1.2 Right? Two points here or there, but just take
it in total roughly 80% of those two. The Odyssey is about 65%. So a meaningful overweight to industrial multif family property types that have had a really good run and we think we'll continue to have a good run on a go forward basis. Um so we like that overweight. Another overweight that
doesn't quite look readily apparent is in our you'll see it in green is our retail allocation. So it looks like it's exactly the same 11% to 11% with the Odyssey. So it looks like the same. So why is an overweight? The reason I'm saying it's an overweight is the only gross the only retail we have is grocery
anchored retail. So it's a really kind of conservative retail. It's like the non-discretionary stuff that people kind of have to buy and it's your top tier grocerers in a market. Yeah. This question >> it's it's apartment communities. >> Yeah. Not single family houses. It's
apartment um communities. No problem. Um, so on the retail side, this would be your top tier grocery rank centers. So if um, you know, Publix in Pmpo or Pepper Pines, sorry, we own that. Um, it's HB in Austin. So if you go to these markets, you'll ask the
local people what do they shop at? It's that center, you know, everybody, it's different by market. Whole Foods in Boston, that kind of thing. Um, we have a huge overweight. So the actual Odyssey index is only a little bit of that. Most of what's in the Odyssey index is like malls, back to New Jersey malls. um you
know high street these kind of expensive Hermes shops in New York City that kind of stuff all we have is grocery anchor retail it's done really well for us and so it's a huge overweight at that sub sector level underweight position is office and you'll see we're only 5% office we have four office assets the benchmark
averaged about 16 so when you think about where the overweights are and where your underweights are we really like the relative positioning of our fund on a go forward basis we think it should continue to sustain the returns and then um to the question that came up earlier about data centers. Um you'll see that in the kind of yellow at up top
we have one asset in Northern Virginia. It's about 4% of our fund. Um the benchmark has about 9% in the other category, but most of that other is like self- storage and other things. It's not really data centers is like a small part of the overall odyssey. >> I think yeah, we're comfortable just
with the one data center deal. We don't want to dial that thing up much further. These are kind of lumpy transactions. We like the investment, but we're not trying to double down on it. Um, and then regionally, I'll just talk through on the chart on the right. Um, again, it's the property types and markets,
right? And so when you look at the markets, the biggest distinction we have is our focus on your guys' region here in the south. So dark blue, 43% of our fund is in the south. And specifically when we say the south, it's the
population centers of Florida, Texas, I don't tell you, Atlanta, Nashville. That's the south. So, um, that's what's kind of included in that 43%. Um, the average for the benchmark is about 22%. So, it's double allocation to an area
that has obviously the fastest, you know, population growth, GDP growth, corporate relocations, employment data. So we think we're positioned well both in property types and markets underway positions to kind of the lower growth areas the Midwest and the Northeast. Um and so we think that that's really good
um on a relative basis. Um the last thing I know we're getting close to time. I have a timer here. I want to hold you all up. I know we're the last one's up so respectful of the fact it's probably a long day. Um I'll just hit returns real quick. Um starting on page 19.
So page 19 is simply you know our funds returns compared to the Odyssey index across all the relevant time frames since inception. So the top chart in dark blue is our net returns. Light blue is the Odyssey's net returns. Um and
then below that in green is just the delta between those two. So the level of outperformance for each of those different time frames. You'll see one year, three year, five year, seven year. The numbers change over time, but the relative positioning does not. Meaning we've outperformed the Odyssey across all of those different
time frames by different margins between 140 basis points over the last year and you know almost 400 basis points per year on a seven-year basis. So really good outperformance. Now page 20, and this will be the last um performance chart I'll show you um actually is a
little more of a reflection how we think. So page 20, same color scheme at play. Okay, so dark blue is us, light blue is the Odyssey. But this is what we think is actually the best measuring stick for open-end core funds. It's kind of three-year rolling three-year
averages. So every quarter you have a new set of rolling three years that you can look at your performance. The reason three years we think is important is in core open-end funds, things don't tend to change very quickly, but there can be some volatility quarter to quarter or or
on an annual basis. So when you take a step back and look at over three years, that's when you start to see sort of it smooths out any volatility either at the fund level or within your markets and really says like over a longer period of time, three years, let's just say it's the intersection of is the portfolio
strategy being consistently supported in terms of the results of the fund, right? Not just one quarter or whatever. And so for us, the rolling three-year is a really important chart. And our stated goal is to be top quartortile compared to that Odyssey benchmark on all rolling
three-year time frames. And what you see here again, the same color scheme. Dark blue is us, light blue is the Odyssey. The green is at the bottom showing all the different levels of outperformance. But the more important thing is kind of buried in the middle quartile ranking.
Uh or top quartortile compared to against every rolling three-year increment since the fund's inception. And so for us, it's always trying to think about positioning the fund, doing those five things that I talked about at the beginning over and over and over so that every time we have a new three-year bar, it'll show us at the top of the
list. And that's that's been our goal. And fortunately, we've been able to achieve that. And uh our goal obviously will be to continue to that moving forward. So maybe I'll stop talking and see if there's any questions. >> Yeah. One one question. Uh back on 18, it shows your relative weights.
>> Yeah. uh they seem pretty stable since what uh Q122 they've they've held pretty consistent. You see that going forward? Is there anything should we are those going to change in any one direction? >> Yeah, I would say um relatively stable.
The one thing that has been introduced is the data center deal at 4%. Um so that will we think that'll stay around roughly 4%. Basically big picture I would expect our fund to have about 80% industrial multif family around 4040 maybe it bounces one or two points on
either side um 10 to 15% grocery retail um so let's just say 10 to 12% some of that range that data center four and then office being a a shrinking a more and more shrinking part of our overall portfolio um so we don't expect um office to be a big part of the fund on a
on a go forward basis >> so no major changes But maybe as office shrinks, you guys will have more retail. >> Yeah, exactly. Yeah, retail would come at the expense of more office in that case. Yeah, but I don't see us introducing a lot of new property types
in the near term to be honest with you. Yeah. >> And pardon me for not paying attention. When was inception? >> Uh 2018 first quarter. Okay. Thank you. >> So coming up on what, seven and a half years at this point. Yeah. Can you just highlight for us where the
the fee um breakdown is or the terms for the fund? >> Yeah, there should probably be page somewhere here. >> Uh it's um page 55. Um but the short story is for the first 25 up to the first 25 million
commitments it's a 100 basis point fee and then it blends down as commitment size tears up. So but it's 100 basis points for 25 and under. Thank you. >> Any additional questions? All right. We appreciate the time today. Uh, thank you and we'd love to work with
you, but obviously I've got great candidates and great um options on the on the board. So, >> all right. >> Thank you. >> Have a great Thanksgiving. >> Thank you. >> Thanks a lot. >> Thank you. Everybody tired about uh real estate.
>> Are you a contrarian view? >> Public is well diversified. >> Yeah. You know, to add to this, I met with a real estate re like right before this at 2 o'clock, uh, Cohen and Steers,
>> and they're launching a non-listed real estate just like this. And it is exclusively focused on Publix and grocery anchored shopping centers. Like that's >> that's it. That's all their their entire fund is, right? that
>> uh so it does seem like a real popular space right now. >> I mean it it certainly has done well. Um but it it it also comes back to the lack of diversification. You know the the typical buyer of that sort of fund is
somebody who already has core maybe even value ad and then they start you know adding in more concentrated slices. >> Yeah. Yeah. I'm not suggesting we go back and introduce another option. I'm just saying like >> I've heard a lot of things about retail.
>> Well, you know, for a few for the last three, four years or you know, going back a little ways, retail struggled a bit, especially with COVID people not going to those stores. Industrial did very very well in that runup as as Amazon's and and and a lot of more
e-commerce, you know, that did really well. But are you going to get the same type of growth out of industrial for the next five years? Probably not. Um, not likely to get it out of office. So now you're you're looking at sort of those other sectors, whether it be retail
because again, it hadn't done as well, but it's starting to see more signs of life or the the residential area. But that that's what's so, you know, important about these portfolios. Um, you know, unlike a stock portfolio, if you see a a trend or you see something
happening within a day or two, you can reposition the portfolio. When you have, you know, five billion dollars worth of, you know, hundred, $200 million properties, you can't just sell one one day and buy one, you know, another one the next day. So, it's it's a it's a
it's a big ship that you have to turn slowly. And and that's why uh they really like to focus on when they when they're talking kind of what they what they looked like three, four, five years ago to try to kind of give you a sense directionally what they're doing, where they're going.
seems like a very tough market market to navigate because when you think about it in terms of groceries, it seems to me like the technology side of groceries is moving towards uh less brick and mortar, you know, being able to buy through
Amazon online or >> or people doing uh was it Instacart and that kind of thing and having food delivered to their homes. >> Oh, a lot of residential in the in the portfolios. bought a residential and residential need groceries. So,
>> right, I feel like there's a a lot more dice playing in in this in this arena versus the stock market. It feels like >> I know the stock market could be volatile, but it always seems more stable for >> at least in my eyes. You know, you're going to get 10% on the annual annual
basis in your stock market where this is like >> Yeah. >> Which way do we go? >> It's the data centers are concerning to to me. >> Yep. They're grow. They're popping up like crazy. So are energy plants. Mega mega uh what do they call those? Mega >> because because you have to you have to feed the data center. You can't just
have a data center with no energy, right? >> And so you have to you have to have some way to power them. Yeah. And they take a lot of power. >> Well, they're not a fat. They're not going away. >> No, they're not going away. Well, you know, and I but I also liken
it back to, you know, in the in the late 90s when we were talking about the the dot, which a lot of people refer to as a bubble. And and the the idea was, well, the internet's going to be kind of everything, right? So, if it if it's got do in the name, bid it up because this
is the future. Well, a lot of those companies went out of business and from a stock price perspective, they didn't do anything for six, seven, eight years in the early to mid 2000s. Yet, everything we're doing is online. >> So, it's sort of like the the the path
was correct, but the horse changed, you know, the as you went through the process. So I don't I don't doubt that AI is going to be transformative and and 10 and 15 years from now a lot of things that are happening are going to be along
that that that that realm. But the question is you know is it Nvidia on the stock side? Is it this data center or will there be other ways that it it sort of manifests itself as opposed to just what we >> some of these companies the stocks have gone out of sight and they haven't made
a dime. >> Right. Yep. That's >> um but let let me kind of bring it back to to kind of where we are. So, as a reminder, we have the the JP Morgan uh strategic property fund that we are in the process of redeeming from. Um as of
September 30th, we had uh $4.9 million invested or still in that fund versus our target of $6.9 million. So, as a on a current basis, we're $2 million underweight to real estate and
we're getting payments, albeit slowly, out of that JP Morgan fund. So, if we don't, you know, if you don't do anything, that that that percentage will keep ticking down and will become more and more underweight to real estate. So that's kind of again why we wanted to begin this conversation because it is a
somewhat of a slow process and depending which ultimately fund you you may or may not pick there's a a speed or a difference in terms of how quickly money gets invested. Just want to make sure we're we're kind of thinking about that and not getting too far away from from target.
>> Are are we supposed to make a decision on this today? >> How do I say this? >> You weren't supposed to. You don't have to um >> you should but >> remembering three months from now about
present becomes very difficult and oftentimes if if plans wait then it kind of gets fuzzy and they sort of it becomes more difficult to make a decision. But if you if you don't want to or unwilling to today you don't have to.
Well, maybe maybe if we just do a quick show of hands. Um, who liked which funds? We can eliminate one or have open up a discussion. >> Allowed to do that. >> I think anything could be discussed.
>> Sure. >> I like number two. >> I like number two. >> Stockbridge. >> Did anybody like number one? >> Principal. >> Principal. that >> he said nobody likes principal. Oh,
that's cool. Uh, who liked number two? >> Uh, and number three. >> I like the >> No, I'm waiting to see how the room goes. >> Yeah, same. >> They were they were very they were very similar.
>> Yeah. and and one of the reasons they're they're more similar is they're somewhat similar in age. They're a little bit on the younger side. So, you know, if you were a if you were a fund that was in business 25 30 years ago, there was a big part of that market
where office was what was doing well. So, in order to be competitive, you had to be in office. That had to be a big part of your portfolio. But when you're a younger fund, you know, as as a lot of that had played out and then certainly by the time you get into COVID, it was it's easier to be underweight when you
when you were kind of at a at a later starting point. Um so I just kind of want to mention that as as a difference because um because again the the slowmoving nature of these portfolios um the longer they've been in in around the more you're going to have sort of a
legacy impact from from kind of prior versions of the market. I I was impressed by both of those funds though. Um I just looking at Stockbridge uh they were up near 20 25%
in 2018 2019 and they were able to get that down you know to 10% by 22. >> So they they moved pretty quickly. And this I saw the same thing in the TA uh when they when they realized the market
was changing. they both were smaller, nimler funds. They were able to unwind that position >> which is is is certainly beneficial. That that was actually one of the the catalyst relative to JP Morgan that that kind of led to our recommendation to
move. Four years ago and three years ago, they had they had come out and said, you know, we want to reduce office. We want this is how we want to change the portfolio. and three years later it effectively hadn't moved where where most of their peers were were roughly
saying the same thing and you'd see all of them actually move and that portfolio is staying relatively stagnant. So it was sort of a lack of execution. It's one thing to identify where you want to be but if you don't actually go there it doesn't help a whole lot. Um so that's
>> what I hear you saying John is you like Stockbridge. You know, >> I I like Stockbridge just because they have that huge allocation to retail, >> right? >> And it seems like that's where the puck is is moving.
>> So, it looks like it says minimum. >> He did. >> That's the official stated minimum. But yeah that how do I say this when you we have to show sort of the official numbers but when they come to a
presentation they can adjust that and and they will they will take a smaller amount. So again the numbers today were essentially 2 million underweight. Um and one of the questions I was asking or or making sure they covered had to do with the the pacing of the queue. So
what you heard from both Stockbridge and TA is there's no flexibility on the queue on the entrance. So when you commit when they call whatever they call you need to send them um principle is the is a
little bit different. They actually are very flexible. So you could commit $5 million and they'll maybe call it next month or next quarter and you say, "Well, thank you. We we see that you called five. we're going to send you one
and they'll pretty much just accept whatever you give them and so you have the flexibility. Now again, that's not the sole reason, but I I wanted to make sure you understand that is different with principal as compared to the other two and quite frankly all of their peers. Uh principal is really the only
one that does that. So if we were to choose Stockbridge or a TA, what I would suggest is we kind of do it in stages. So, we're $2 million underweight. By the time paperwork gets done, you get to that point. What I would probably suggest is committing two and a half
million because that's likely about where the the hole that we would be in by the time they actually call the money. Okay. If all of a sudden we see JP Morgan increase the pace of of their redemptions and all of a sudden we have an additional two million or$2.5 million
dollar deficit, then we just go back and and add to the commitment. So effectively, we're gonna, you know, do it in stages because again, if we just commit seven million now, it'll get called in within six months. And if JP Morgan takes two more years to to get us
the other five, then you're all of a sudden you've gone overweight to real estate and we don't want to do that. So it try to we would have to be thoughtful about staging it in in pieces to not kind of overshoot. >> How do you feel about the three? Um,
>> are you allowed to find on any >> of course uh I mean first we like all three. I think principal is a little bit more of kind of the traditional bellweather. It's going to look a lot more like the index the the average market. >> They're the same as principal life.
>> Yeah. Is that >> the insurance company? >> Correct. Um I think Stockbridge and TA are both smaller. They're more nimble. um they're likely to perform a little bit better, but again because they're
they're taking a bit larger sector bets. You also have a slightly increased chance of if they get it wrong in office or retail than having maybe a little bit more underperformance um because they're not as diversified, but their track record has kind of proven they've been pretty good about
those allocation decisions and they've consistently outperformed. How did you feel about that? >> Um, they're they're pretty standard. Um, and page 11 of the the the core book that I have shows all three funds. So, Stockbridge is at 95 basis points. TA is
at 1%. So, you're talking about five basis point difference between the two. Um, with Stockbridge being the cheapest. >> Question where it has two the first two principal and MTA have two saber lock says two quarters for stock is that
guarantee two quarters are in or is it >> no that that's kind of just and that's when I asked the question I said based on what you know today what is it because just let me give you an example what if all of a sudden they met with an investor tomorrow and said we'd like to commit $2 billion
it's going to take a lot longer than a quarter to get that in um or you know if all of a sudden um they have a large investor that wants wants to redeem or or all of a sudden they come across a new building opportunity uh a new building they want to buy that's three
four $500 million. Well, if all of us, okay, now we have two or three hundred million sitting in that queue. We can go ahead and put it to work because we got a building to buy. But if they don't have a building to buy, they don't want to just call your money and hold the cash. And so it's a it's a little bit of a of a
balancing act between what we see out in the market, what we have in terms of incoming investors if there are any um and the timing >> once that once we say hey we're picking the stock bridge and we do the contribution queue
do we have to meet again for >> to final it's good to go >> correct okay >> so so I mean essentially if if you were to vote >> well no matter which way say it's Stockbridgeidge essentially Pedro will go ahead and and and get the subscription documents or any any contractual things worked out and and
you you're signing a commitment for a dollar amount. >> So then once that's in, then you're now officially in that queue waiting for that capital call. They said like, you know, it's likely April and or June. >> Gotcha. Um, but again, they just they
can't tell you what the market's going to be in four or five months and and where everything. So, they can't commit to what that is. But based on what they know today, they would expect to call your money in either April and or or part of it in April and then part of it
the other part in say June. That two and a half million you mentioned earlier is that cash on hand redeemed from JP or is that hedging that we are going to get that that is the amount we are underweight our target. So
it is a combination of getting money back from JP Morgan the fact that our equity portfolio and other portfolios growing. So, as as the equity is going up and and real estate, although going up, hasn't gone up nearly
as much, it's shrinking as a piece of the pie. Plus, we're taking or getting redemptions out of it, which is further drawing that down. So, again, we're as of September 30th, we're $2 million underweight in real estate.
I'm by the the two and a half million that I I I mentioned is essentially I'm adding a little bit to it because I figure by the time it it's three four months down the line by the time the check actually gets sent on any commitment we're going to get one or two more distributions from JP Morgan I'm
estimating right and and then hopefully the rest of the portfolio continues. So I'm I'm just guessing in three four months we're about that that $2 million gap is probably going to two and a half. And so that's why I I kind of targeted that. But that there's definitely an art to that. There's
>> So you're you're targeting using our target allocations, but if we do we only have I'm looking at your your thing. We page seven. >> Yeah. We have what? Page five. We have a million dollars in cash right now. So we'd have to sell something to
>> Yes. >> We would. >> Correct. What's the um What's the significance of the them not being an Orisa fiduciary? Does that mean they are not legally obligated to act in
our best interest? >> If Pedro is Pedro on I'd love for him to opine, but typically the way and well I'll jump in first if he's but >> you should be. >> They have to be a fiduciary to the fund as opposed to being a fiduciary to an
investor. That's the difference that because they have to treat all everybody in the fund the same. Their obligation is to the fund. They can't sign a different obligation to you. That's typically how I understand that working. >> That's I think that's exactly right. Can
you guys hear me? Okay, >> we can. >> Yes. >> Okay. Um I'm sorry. I'm just having a hard time hearing you guys. It's really the audio is very low. Um, so yeah, I think I think just just as Brendan explained it, it's uh it's essentially they acknowledge that they're a
fiduciary, but they are fiduciaries to the investment fund as a whole, right? Similar to to your position, right? You guys are fiduciaries to the fund, not uh an individual member, uh, so to speak. Uh, the same concept, they can
acknowledge and they will acknowledge that they're fiduciaries to the fund itself. Uh, which generally means that our interests are aligned, right? as an investor in the fund. However, uh you know, it's that's not always the case and and you know, I'm sure we can all come up with different scenarios where
where there may be um competing interests, although although they're they're pretty limited. Um so, that being said, they uh all of the managers that you guys have uh have interviewed or heard from today, um uh we we have agreements with them, we have side
letter agreements with them, and so uh they will acknowledge that they're a fiduciary. But to to Dustin's point, uh they are fiduciary to the fund, not to uh you know, Jacksonville Beach uh general employees or Jacksonville Beach police officers or Jacksonville Beach firefighters retirement system
specifically or uniquely better way to put it. >> Were they aware of our um underweight position when they came in here? um they they know that you have JP Morgan
and then you're in the redemption queue. I don't we didn't talk specifically about the the waiting or how underweight you were, but just essentially I I wanted to make sure um that they understood that, you know, part of the allocation that we intend to be in the
space is somewhat tied up right now. And so I wanted you guys to to hear from them, you know, the situation, you know, how what it would look like in terms of commitments and timing and the like because it, you know, again, we're based on your current assets, you should be at
$7 million. So we'd love to say, well, we just want to have $7 million with the fund we want to be in. But if you do that, then again, because of the restricted nature of the other side, then you you find yourself in an overcommitted position. I felt like principal like already knew that and the other two didn't just based on the way
they were reacting. But maybe it's because they were they have that flexibility built in. >> Yep. >> Are we open for a motion? I make a motion to commit $2.5 million to the
Stockbridge Smart Markets Fund um with any unredeemed monies from JP to come from a rebalance in international equity. >> Too broad.
>> Second. >> Hang on. Why don't we why don't we get a recommendation on the motion before we go too far either from you or from Pedro. >> So the only thing I would throw out
there would be to to to unlink those two things. >> Okay. >> We we could you make the motion to hire them or make the commitment and hire them. >> Okay. >> Yeah. >> And then second to that, let's have a discussion about, you know, if we want to do anything different in terms of of
of raising the money for it or or what have you. But but I wouldn't necessarily directly link it. >> Perfect. That I made my motion to commit $2.5 million to the Stockbridge Smart Markets Fund. Period. End of motion.
>> Okay. >> Does that work? >> Does. >> Is there a second from the police board? >> Second. >> Let's do them board by board. >> Second. >> So I I think you guys have to do it board by board. uh assuming you all are going to you know kind of engage the same manager which you're obviously not required to but but just because each
each board has its own allocation and and so each of the three would need to make their own separate motions >> and I guess it is important to mention the $2.5 million is a the collective investment right so if there is one board that wanted to do something different
>> then then we'd have to reopen that discussion because again that is that is all on a collective basis >> or should the first motion just be to Pink Stockbridge period. >> Well, the the paperwork that that Pedro would be assisting with is going to have
to put a dollar amount on it. >> Um, so I I do think it's appropriate to to pick. >> Do do we have a dollar amount, Brandon, for each fund? Do you know? Or do you want to just do like a percentage? uh >> you know at the time of the capital call
or or that way it's not a specific dollar figure but whatever you however you want to do it. Uh, I just >> I mean I think it's what what's easiest is to to select a dollar amount and then 6 months from now as we see the the JP
Morgan situation continue to unfold we'll come back with another recommendation say okay we're ready to commit another I'd recommend another $2 million commitment as an add-on um and just kind of do it in we might have to do it in three or four smaller phases. What does that what does the 2 and a
half million work is it even is it evenly distri or split amongst the three boards? >> Yeah, that that's all done on an actuarial basis. We don't really cover that on the investment side. The the three the three individual funds are pulled into to that on a representative
basis. Um so it's not like I say that the two and a half million is you know 900,000 from fire and 1 million from general and so on. Um but but again to the to the extent that if one of the boards wanted to do something different
then that would >> I think what he's getting to though is for the purpose of this motion does he does police need to say can they just say 2.5 million collectively or do they need to say a smaller
pine on that but >> we've always done we've always done it on a collective basis >> so let's just keep doing that. Yes. >> Okay. So, we can That's fine. >> Okay. We have a motion in a second. >> So, I think So, I think if Yeah, if if each board um if each board just wants
to go ahead and approve or or make the motion to engage and again, I don't know what it is, but if it's going to be the Stockbridge Smart Markets Fund um uh in a collective amount of $2.5 million as recommended by our consultant. >> Perfect. We have that motion on the
floor from the police board with a second. Madam clerk, roll call for police. David Cohill, >> yes. >> John Patrick, >> yes. >> John Godilla, >> yes. >> Jason Sharp, >> yes. >> Firefighters, if somebody wants to just
say so moved. >> So moved. >> And a second. And uh any discussion? Roll call. >> Second. Yes, we did. >> Mr. Canandler. Seconded. >> George Canler. >> Yes. >> John Wiggins. >> Yes.
>> John McDaniel. >> Yes. General employees. >> So moved. >> Second. We've >> motion a second. Roll call. >> Dan Jansen. >> Yes. >> Christine Hoffman. >> Yes. >> Any barber? >> Yes. >> Motion carries. Moving on.
>> Now we'll jump into the 9:30 the actual quarterly review. Um I'm going to do my best to go through quickly because I know you've been here a long time. Um but this is our fiscal year end. This is kind of the arguably the most important um report of the year. Um so just really
quickly I'm going to open up to page number uh interestingly the page number is cut off uh four. We finished the fiscal year with a very strong quarter. I'm looking at the the color uh bar charts on the right hand side upper right hand corner should look
like this. It's the thicker of the books that says se period ends September 30th. >> Uh page number four. They're on the left hand side. It looks like at least on my book the printer cut it off. >> So I'm on this page four
>> quarter performance. All it all it says it looks like page number one because it >> I apologize. Apparently we're having a toner issue or something. Um but again I'm in the upper right hand corner and what you'll notice is everything was nicely to the right.
Positive performance S&P 500 was up over 8%. Small cap was up over 12.4%. So very strong headline numbers. If you look in the bottom right hand corner, this is the 12 months that corresponds with the fiscal year, 17 plus percent
for the S&P, uh almost 11% for the Russell 2000 small cap, international roughly 16% depending on the benchmark and even fixed income was also positive. So that kind of the what I call the major food groups where we have the majority of our assets were all nicely
positive for the year. So as a as a general rule, um we're going to have a a pretty decent year. Um, if you skip uh two more pages, it's going to be page number seven. I apologize you it's very difficult to see, but it's the one that looks like this. I tend to skip over this page, but there
is something fairly fairly telling. Um, I'm focusing on the upper right hand corner. What this page does is it shows you the 10 largest holdings within the Russell 2000, the small cap universe. I just mentioned for the quarter the small
cap benchmark was up 12.4%. If you look in that middle column, what you'll notice is each of the 10 largest companies within that index, the worst performer was up 13.8. The best was up over 253%.
So, it was very skewed, the performance was very skewed to some of the larger names and all of them did significantly better than that sort of average or benchmark level return. One other thing that's kind of it's not really in that this particular uh set of numbers but
this last six months and for small cap in particular was the second worst uh period of active manager performance ever >> for the last six months including this quarter
>> for the Russell 2000. So if you if you take the the all of the active managers over the last six months within small cap, it was the second worst relative performance that they've ever had in history. Very simply, um the the biggest factor
that has driven performance was negative earnings. Companies that didn't make money did the best. Now over long periods of time, companies that in small cap, companies that make money outperform the ones that lose money by
roughly four to one. In the last six months, companies that didn't earn money outperform the ones that made money by roughly 8 to one. So you've had a a very nuanced shift. And I I partly the reason I'm bringing that up is we're going to
get to our small and midcap manager and their performance looks dreadful, but they're a quality manager. They look for earnings and so they don't own companies that lose money and and and and so that part of the reason you're seeing some of that underperformance and I wanted to sort of highlight that just a little
bit. Um so now let's go ahead and and skip ahead to it says page number four, but it's p page 14. Um, it's the one with the big, uh, chart up into the right just showing our assets. I I always like to make sure I'm I'm touching on this particular graph, $138
million as of the end of September versus that net cash flow of almost negative $39.3 million. Now, down there at the bottom, you can see the asset allocation. If you flip ahead a couple more pages to page 17, well, there's a lot of pages with the asset allocation.
I like page 17 because it shows very quickly where we deviate from the target. You'll notice, I think this was brought up just a minute ago by David, we're about 1.6% overweight within international, fractionally under in domestic, and that 1.4% underweight to
real estate. We've uh obviously taken some some action to go ahead and rectify that with uh with the new strategy. And then obviously we also have some some cash as well. So with that, let's jump to page 21. How does this all come together?
So for the quarter we were up 3.6% in the 87th percentile behind the policy of 5.39% the policy was in the 22nd percentile for the fiscal year to date 9.58% um behind the policy of 11.48. So
certainly disappointing relative performance um as we see and if you move down the page the bottom of that page you can really see that the main the main culprit of that eaten vance negative 7.7 versus a positive 10.1 huge
performance deviation. Now longer term, this strategy has has been fantastic. Um they've performed very very well. Um but certainly have have missed big within the last 12 months. And that accounts for a very large chunk of the the total fund um underperformance on that fiscal
year-to- date basis. On the positive side, when we were sitting here, you know, two quarters ago, we were in negative territory on the fiscal year. And so what I want to highlight from a positive perspective is we were all sitting here in in the middle of May talking about a negative one negative
2%. I said hey I think we can get to positive nine and a halfs by the end of the fiscal year. I'm hoping everybody said yeah I'll take that. Um so ultimately we did get that finished with a very good ultimate fiscal year but it did obviously disappoint on a relative
basis. Um just really quickly since it came up a minute ago, page 22, um we've had very nice performance out of international. International generally has performed a lot better these last 12 or 18 months. In addition to that, your selection of
managers has also done very well. So international as a group outperformed by over 3%. you see on the fiscal year-to- date basis 20.38 versus 17 with DFA your your new portfolio um up almost 26% over
the last 12 months very good decision on on selecting that one um and Europacific did about 15 and WCM was about 17%. Um but again those numbers in total or that international category has grown more than domestic and that's why we have
that that one point I think it was 3% overweight um now to to international because of that relative performance. Um and then we've got obviously our fixed income. The fixed income actually did fit very nicely 3.8 versus the the benchmark of 2.5 with the multiple
strategies blended together. Um and then PIMCO diversified also did very nicely 7.4 4 versus 1.5. Um, so we had a lot of strong performance in particular in outside the US and fixed income. Um, and JP Morgan actually even though we're in
the redemption queue, they that performance has turned around somewhat on a relative basis for the fiscal year over 5% versus the benchmark of 3.8. But you see obviously when you get out to those longer periods um underperforming and we've already taken uh some
corrective action there. Let me pause. I know I ran through that very very quickly. Um, but are there any questions, comments, anything that I can answer for you? Um, I do have one more book for you. Do but do you want to Typically you approve this by motion. Do you want to go ahead
and pause and do that first? >> Can we go by board to have a motion to approve the uh investment consultant report of September 30th? >> So moved. Motion by police and a second. U madam clerk roll call. >> David Cohill.
>> Yes. >> John Patrick. >> Yes. >> John Gutella. >> Yes. >> Jason Sh. >> Firefighters. >> So moved. >> Second. >> We have a motion and a second. M for roll call. >> George Kler. >> Yes. >> John Wiggins.
>> Yes. >> McDaniel. >> Yes. >> General, please. So move. >> Second. >> We have a motion to second. Roll call. Dan Jansen, >> yes. >> Christine Hoffman, >> yes. >> Eddie Vara, >> yes. >> Motion carries.
>> So, the the last book that you have in front of you, um, it was this was requested at the the last quarterly meeting to get a little bit more information on on private equity. Um, so I put together um, this book. It does a couple of things. It kind of talks more broadly about private equity,
some of the different characteristics about just the the asset class. Um, and then it also gets into a few examples or of of types of strategies that are currently in the market. Um, so I'll start on page number three
and talk about some of the different parts of of private equity. So on the lefth hand column you've got direct fund investments. Um, so this is obviously where you're you're going direct making a a fund or an investment specifically with a a a particular private equity
fund, but you typically need fairly large commitments in order to do those kind of direct investments. And these are one or or kind of one-off basis. So generally unless you're a you know billion dollar plus system you probably don't have the asset size where you're
making commitments because you you're not really getting a whole lot of diversification. Um multi-manager and co-investments um again similar you're you're you got a few a fewer number of investments um but you're investing alongside a limited
partner that that's going in. Um, so also from a from a kind of risk and uh return perspective, we'd expect the highest returns out of direct, slightly lower returns out of multi-manager co-investments. And so as as you go left
to right, you tend to get more diversification and a slightly lower expected return. Then third, we have fund of funds. So this is where you you'll have a company a manager that actually is pooling investment dollars and then they're
going out and hiring say 10 to 15 actual private equity firms. So they decide okay we want to go partner with a uh health care private equity firm here and oh now we want a a finance and a technology. So you're you're partnering
with a manager who then has a strategy and then they make those underlying commitments. So, it's actually a fund of funds. You tend to get broader exposure. Um, a lot more diversification in your underlying investments and that's a way to access, you know, proper level of
diversification without quite the the the capital that you would need if you were doing it directly. And then on the far right hand side is secondary investments. Um so this is a little bit different in that um all the first three you are making kind of fun uh
investments at the beginning of the life cycle of the investment. So secondaries you're buying a an interest that's already been around for two three four five years. Um and so um the you get a lower expected rate of return because
the buyer of a secondary investment has already seen this company operating for the last however many years. it has a bit more of a track record. So, it's more of a known quantity. Um, but because it's more of a known quantity, there's less risk there. You also have a lower expected rate of return.
Um, if you move down to the next page, page number four, one of the things that gets talked about a lot is the J curve. Um, and this is what what essentially investment losses uh upon making an initial investment into private equity. So, the way private equity works,
somewhat um different from your your other kind of conventional um investments, is you are charged fees based on your commitment, not the money that you've actually given them. So, I'll just pick a number out of out of thin air. Let's say you make a a $10
million commitment to a fund charges 100 basis points or 1%. So, you're paying $100,000 a year in fees, but they may only, you know, within the first six months, they're only going to call a smaller uh portion of that, maybe two or
$300,000. So, you've sent in $300,000, yet you've got a mil $100,000 of fee coming out of it. So, as a percentage, a $100,000 fee against a $300,000 investment is a pretty significant, you know, percentage. So when you look
at it on a percentage basis in those first year or two you'll see a a negative number in terms of the return a negative percentage. It might be negative - 20gative -30 negative 40%. Now it's not negative 40% of the 10
million. It's only 40% or 30% on the 200 or 300,000 that you've sent them. But optically speaking it can it can cause some kind of sticker shock, right? Um and and so again it's it's typical important to understand that there's
this J curve in the traditional investments. Now, the secondary market, because you're already buying seasoned investments, um there tends to be no J curve. And that what this graph kind of depicts is when you buy secondaries,
they tend to go up right away and you don't actually go negative, but then over time, your your overall return ends up being lower than the other ones because you get the higher growth from those those other kind of more primary investments. Does all of that make
sense? Okay. So, again, that I just wanted to provide a little bit of of background and kind of the the different parts of private equity and how it how it works. Um, for the purposes of this, anytime I have
a fund that that does not have any private equity exposure and that might be considering it, I what I usually do is start with kind of two different subsets. I start with secondaries as I mentioned because again it sort of tends to mitigate the J curve gets funds invested faster. Um but then I also show
some different fund to funds giving you a little bit more diversification. Now there can be a J curve impact but as you as you will see a number of these funds have begun to incorporate some investment um strategies to mitigate the J curve. So even though the fund might
be 80 or 90% traditional what we call private equity, sometimes the first investment they make is to a private credit or so they so they get some income right away or they they'll do a little bit of secondaries and they'll make a secondaries investment early to
kind of create some yield or create income so that when the other other investments would be in the J curve, you've got some positive returns to to help mitigate that. Um, so with all of that said, um, on page number seven, just showing you the
the four funds that, um, that I'm I'm I'm showing you today. Um, and again, what's important also, I should back up for a second in within private equity, unlike the real estate funds that you you just heard from, those are all open-ended. So, if you wanted to get
into principal or or TA two years from now or five years from now, they're going to be around and available. In private equity, they're raising a specific amount of money over usually a fairly defined period of time. So, they're going to try to raise $500 million and they're going to try to do
it over 12 months, right? So, when they get to 500 million, they essentially stop fundraising. And so, these funds won't be available a year from now. These are just ones that are in the market currently raising money. Um, so if you're to say, "Yeah, we're interested in private equity, but but
we're going to wait 15 months to look at it." I'd have to come back with a new list because all of these funds will have been been closed out and finished at that point. Um, in terms of fundraising and and would have to bring you a new list. So, I wanted to just make sure you unders uh understood that
kind of difference as well. But again, going back to that, we've got 50 South um Capital Advisors, High Vista, uh, Mezero, and Taurus. Um, just so you know, the 50 South and Mezero are secondaries managers. Um, so
again, I was trying to give you a little bit of a of sort of a combination. Um, and then the High Vista and Taurus are the more traditional uh fund of funds. Excuse me, I got that wrong. It was um 50 South and and High Vista um fund of
funds. Um, let me pause there. Would you like me to really dig into some of the different strategies? I know we've been here a long time. Part of this was sort of the education, getting a sense or a feel as to to kind of what these looked like. Uh we talked about the broader
asset class. Would you like me to kind of to kind of go through the individual strategies or what what's the appetite of the boards? You know, as we said today, Correct. Uh, you know, again, within sort of the ordinance limitation, even though it's private versus public, you'd
still call it equity. So, from the from the ordinance limitation standpoint, it would fall into the to the equity bucket. Correct. Um, >> and you I know you didn't get to it. Give me the Super Readers Digest answer to on page 13 where 50 South is the
preferred return is not applicable and everybody else is at 8%. >> Good question. So, typically in in these private investments, the way they do it, they um so preferred return essentially is the the first portion of the return
that you get. So what this means is you know the first 8% return of the fund goes to the investor. Then above that level there's a carried interest which means the portion of the earnings that they're going to share in. So a
very common one is say 15%. So if just to make the math nice and simple if if it was a 10% preferred return so the first 10 goes to you. If they earn 20% in total, right? So that
the second 10 between 10 and 20, if they get 15% of that, 1.5% of that of that total or one and a half would go to them, you get eight and a half of that next 10. So they they begin to share in the profit, so to speak,
above that preferred rate of return. So the preferred is the again that's the the first portion of the return that goes to you and then above that level they begin to share and so that's very common but with 50 South they don't have a preferred return
and because there's no carry they don't they don't they just charge a flat fee so there is no carried interest and obviously no preferred return question. All right. Well, I will leave it there unless anyone else uh has other
questions, but happy to to revisit that um you know, when appropriate. >> Thank you so much for providing that information to us, Brendan. We have item F, which is possible action, kind of our placeholder. I don't think we have any additional rebalancing that needs to be
done at this time. And oh, okay. I'm like, how did we go from F to two? Okay. Two pension administrator report Dustin. >> Uh thank you mayor. Um Pedro I'll start
with a question for you. Uh the we have the summary plan descriptions coming up. The firefighters have identified a couple of changes that they would like to make in theirs. I know that we have a two-year requirement on these summary plan descriptions to update every uh
couple of years. Um, so how do we handle this uh going forward? Should they approve this one and then we bring an edited one back at the next meeting or should they um not approve this one or can they make recommendations to edit
this one now? How does this work? >> So all excuse me all all of the above. Uh so I mean I think if if there's changes that they want to make now and and and they know what they are, great. We can, you know, we can certainly um discuss those and and the motion
ultimately could be to approve the um SPD as discussed and revised. U and then obviously I'm happy to make those changes and get that back to you. Uh or you can just, you know, hold off and and wait till our next meeting. Again, the 2-year requirement, obviously, uh, by
statute, we do have to update these things two years, but the state um has consistently allowed for, you know, some some delays on that front um, you know, for example, if if if collective bargaining is going on and there's going to be a new
contract coming forth, uh, and we want to hold off, you know, so as to not publish something that's almost immediately outdated, right? So depending on what the facts are, I'm not concerned about the 2-year requirement. Um, you know, to the day. So, so really,
I think it's just up to the board in terms of kind of what what it feels comfortable doing. >> I I would prefer to get with them after and get specific updates on what exactly we want to see in there and the changes in the wording rather than trying to
hash that out right now over what the exact details are. if we could just not vote on that one today and then uh bring another one at the February meeting. Is that >> Yeah, we've already found like three things that haven't been updated and there might there might be more so I
couldn't tell you on everything. >> Okay. >> But what I didn't want to see is this looks we we would love to take this pension right here that's listed on here, but if this goes we're trying to get the same changes as the other boards. I just didn't want that published to show that we have a 2% cola
and stuff on there when it's when we're we don't have that in those kind of things. >> That's what I mean the details of it. Some people do have a 2% cola in there, but not all of the members. There there are some finer details with that that can definitely be added.
>> So, yes, it has a 2% colon and everybody after for 2014, it should say 1% after that date. So, it just has to be fixed. >> Yep. Dustin, does it make sense just to hold on all three of them until we get there in case there's some consistent
changes that need to be made? >> Uh, that would be fine with me. >> If we're going to hold one, we may as well hold all three. >> Yeah. >> Right. >> What's that? >> Good. Like, if we're going to do one, we may as well wait on all three. >> That's fine with me. Give us some more time to review and uh and go over these
as well, everyone, if they want to take a look at them. Okay. So we'll just >> and if if if anybody if you want to just maybe you know we can we can just talk offline uh if anybody from the board or you know if you want to just share the changes with me and then I can make
those changes happy to do that as well. However you want to do it. >> Yep. Sounds good. All right. I'll dive into the obviously quickly going to go through the pension administrator's report here. Just wanted to mention that those pension ordinance changes did go through. Uh, city council approved the
raises in the total annual uh, dollar capsu 2025, 2026, 2027 to 110, 111, 112,000 and um, raising the drop rate from 3% to 3.5%. So that is now effective in our
plans um, for the uh, general and police. And um then the general plan also added the language for uh service credit purchase. And so what's one of the things we have coming
up here uh for the general plan to approve is the forms to make that possible. Uh Pedro did recommend that we um move forward with having the board actually approve some forms. So there's basically three forms. oberves an
application and then a verification of the service and then a form for how the employee wants the um withholding done uh whether that's in a lump sum or a payment out of their uh paycheck over a 5-year period. So um since we're doing
that for the general plan, we never actually went through that process with the uh police board and these forms have been in use for several years now uh for police. So that is in here as well for uh us to officially approve those forms
for future service credit purchases just to make everything official. Um continuing education February 1st to the 4th Rosen Center DBTA uh winter meeting um is there. I know got a new
member here. So always recommend those. It's just a good educational um thing. If you want to go, I wouldn't recommend starting the school in the first one. Just go to the first meeting with and just try and learn and pop into, you know, whichever sessions seem interesting.
And then um yep, like I said, new member, congratulations to Mr. Wiggins for being elected. And uh we have six
terms that are ending on March 31st. Three on the police and three on the fire board. These are the fifth member um positions and the two council appointed positions. So I will be um
bringing several things before council over the next few months to get those council elected uh positions. The fifth members are to be selected by the other four members and then um approved by the city council as a ministerial act which
is actually what we have on the agenda today for the uh general board to approve. So um and then one other thing we do have um Bren Marzma since his uh regrets that he could not be here at
this meeting. this is was scheduled to be his last meeting and he has been on the board a very long time since 2009. So definitely want to uh put that down as thanking him for his service to the board and its members and the community in general. So
um any questions on any of that before we move on? We got a quarterly meeting. Um the next scheduled meeting for February 24th at 3 p.m. Um I did include
the ordinance changes here in um the book if that's um of any interest to anyone. And I guess on to the meeting calendar. Do we have any um
suggested changes or problems with the meeting calendar of our normal um basically fourth Tuesday of each month that we normally schedule them in with the exception of November uh avoiding
the Thanksgiving week and going to November 17th. uh all meetings starting at three o'clock except for the May meeting starting at two o'clock because that's the financial statements budget and actual report. >> Can I have a motion to approve the meeting calendar?
>> So moved. >> Is there a second? >> Second. >> All in favor signify by saying I. >> I. Any opposed? Meeting calendar is approved. Anything else? Um I guess on to the um general fifth members
selection. Um all these these three candidates have been interviewed by council. Um they have all um shown their interest in their application for uh to be a pension trustee. Uh each one of them put pension
trustee as their number one interest. Um, I will leave that to you guys to go through the applications and make your selection. >> Just disting order of the agenda. Do you want us to do election of officers first? >> I'm sorry about that. Yes.
>> Um, each of our boards needs to elect their chair, um, prom and secretary. So, be thinking about who's not here. Um, general employees, do is anyone like to make it? Let's just do them all three at the same time. Does anybody want to make a proposed
>> slate? >> Chair. Let's just do chair, prom, and secretary al together. >> I'll I'll take chair. >> All right. >> Okay. Nick prom. >> Nick is prom. >> Okay. Can someone just propose a motion
for Dan Jansen, chair, Nick prom, and Eddie as secretary or just say so moved? So move >> second. >> Um, madam clerk will call >> Dan Jansen. >> Yes. >> Christine Hoffman. >> Yep.
>> Eddie Margara. >> Yes. >> And for the fifth member and don't worry guys on the absences that we have coming up. We have a we had a quite a few really good applicants. Um they're not necessarily all included on this, but um in a recent round of interviews that we
did for um potential candidates. So, I think we've got some good potential folks to fill in those holes. But in terms of um replacing Brandon's position, did you have I know you weren't in in the in the interviews, but did you have a chance to look at them and have any any thoughts
>> based on just these applications? I go, Greg, David, but that's just based off >> I was going to nominate Adam. >> Adam Patric, >> I had Adam as a CRA. Oh, did
>> Yeah, I I because I that's what I had Molly bring in my um >> Was he was pension dispersed or CRA? >> He had pension in CRA. I just I put a star by it. >> Okay. >> Yeah, that's fine. I withdraw uh my >> and we can revisit with him maybe before
any other open positions, but I had Greg Greg Klasner first. >> Okay. >> Did you and that was your second? >> That was Eddie's first and >> your second. Okay. >> Yeah. Can someone nominate Greg Klesner?
>> Motion to nominate Greg as the first member of board. >> Second. >> A motion and second. Madam clerk, roll call. >> Yes. >> Eddie Regara. >> Yes. >> Christine Hoffman. >> Yes. >> Okay. And then approve summary plan description for general employee. Oh,
we're not going to do that. We're going to move that to a next meeting. And then the forms that were provided. Um, do we need Pedro to go over those or they were pretty self-explanatory? >> Those were all provided by Pedro.
They're very similar to the um the forms that were created for the police, just obviously edited for the um differences and um I think they are pretty self-explanatory. Um, I don't even know that there's really
anything notable in here other than the verification of general service is for uh, so there's two ways you can qualify whether you you had your federal, state or local service or you had military service for verification of military service. Uh, paper said that we could
accept it DD214. This is a practical thing because uh it's very difficult to get the military to respond to anything uh for verification and stuff like this. And DD214 is pretty official. We know if it's less than 20 years, you're not getting a pension. And the employee also
has to sign in these forms saying that they are not receiving a pension for that time. So um other than that, I think it's pretty self-explanatory. >> Okay. Can we have a motion to approve the forms as provided by Sugarman Saskell and Herrera?
>> So moved. >> Second. >> M for roll call. >> And Jansen. >> Yes. >> Christine Hoffman. >> Yes. >> Eddie Vervara. >> Yes. >> Thank you. Forms are approved by the general employees board. Um please. Who
would you like your leadership to be? make a motion to uh chair Jason Sharp myself chairman pro 10 and uh gentlemen huh yeah John
>> secretary you weren't here last time when I nominated you so this time when I throw you out >> John >> so the same lineup then yes >> okay so we have a motion for sharp chair uh
cohill prom and Gastella secretary. >> So moved. >> I think he was making the motion. So you're making a second. >> Second. >> Madam clerk, we'll call >> David Cohill. >> Yes. >> John Patrick. >> Yes. >> John Gutilla. >> Yes. >> Jason Sh.
>> Yes. >> Thank you for your service. And you also have the um forms for uh purchase of prior service credit etc. Can we have a motion to approve? >> So move. >> Second. >> We have a motion and a second. Madam clerk, roll call.
>> David Cohill, >> yes. >> John Patrick, >> yes. >> Johnilla, >> yes. >> Jason Sharp, >> thank you. And uh moving on, firefighter board, same question. Chair, prom, and
secretary. >> I make a motion to make Mr. Canler the chairperson uh myself pro Tim and Lance Huish as the secretary. >> Can we say yours was a motion and his a second? >> Second. Yes. >> Okay. Perfect. Madam clerk roll call.
>> Yes. >> John. >> Yes. >> Yes. >> Thank you also for your service and we will do all three summary plan descriptions at a future meeting. Any other items for discussion? Any other courtesy of the floor?
>> This meeting is adjourned. Yet >> all right, everybody. Have a good Thanksgiving. Have a good holiday. Stuck him in the car.