SUBJECT/RECOMMENDATION:
Title
Approve agreement with Longfellow Investment Management Co., LLC, for investment in the Longfellow Investment Management Co. core fixed income product; and authorize the appropriate officials to execute same.
Body
SUMMARY:
One of the plan’s fixed income money managers, Western Asset Management Co., has been recommended for termination per a previous agenda item.
The City’s investment consultant, CapTrust Advisors, conducted a manager search for a replacement fixed income money manager. The pension investment committee reviewed the search results at the November 22, 2024, quarterly committee meeting and selected Longfellow Investment Management Co., LLC (“LIM”) for recommendation to the Pension Trustees.
The pension investment committee unanimously recommends LIM’s core fixed income fund for an initial investment of up to $160 million, or approximately 12.0% of the total plan investment portfolio.
As of December 31, 2024, LIM’s core fixed income performance over the past five years has been as follows:
Benchmark
Performance Index
Calendar 2024 2.19% 1.25%
Last 3 years -1.96% -2.41%
Last 5 years 0.35% -0.33%
Investment manager fees will be 0.30% on the first $35 million; 0.25% on the next $35 million; 0.15% on the next $50 million, and 0.135% thereafter.
The pension plan’s outside counsel, Klausner, Kaufman, Jensen and Levinson, has reviewed and approved the Advisory Agreement for execution.
APPROPRIATION CODE AND AMOUNT:
6467410-530100 $350,000 annually