Ohio Police and Fire backs ACM Fund II in $50m commitment

The investment in second vehicle from Agricultural Capital Management marks the first agricultural investment for the $15.6bn pension.

In its first agricultural investment, the Ohio Police & Fire (OP&F) Pension Fund Board of Trustees approved a recommendation for a $50 million commitment to Agricultural Capital Management Fund II on Wednesday, according to its monthly investment update.

Communications manager David Graham wrote in the update that the investment in ACM Fund II marked OP&F’s first agricultural investment and would be part of its newly-established real assets portfolio.

In late March, the OP&F Board voted to approve a recommendation by the Townsend Group, its real estate and real assets consultant, that up to 40 percent of a 5 percent real assets allocation be devoted to agriculture.

Graham told Agri Investor at the time that the decision to broaden its real assets investments from timber into agriculture and infrastructure was influenced by difficulty meeting a 5 percent timber investment target adopted in 2014.

Upon Townsend recommendation, the $21 billion New Mexico State Investment Council also committed $50 million to ACM Fund II in January.

“The manager is one of the few agricultural investment firms to successfully bring together high-quality farming operations and successful agribusiness experience,” Townsend wrote in its recommendation to NMSIC. “The team has many years of experience growing the crops that the fund is targeting, and successfully executed its first fund’s investment strategy to date.”

ACM Fund II will target low-teens returns with a strategy focused on developing and managing farms growing citrus, hazelnuts and both traditional and organic blueberries, according to a January memo from NMSIC director of real return and real estate Paul Chapman and analyst Michelle Dubin.

The memo also said that a quarter of investments from ACM Fund II will be devoted to midstream packing, processing and marketing assets and noted the firm’s commitment to mitigating environmental and social risks of its investments.

Launched in July 2016 with a target of $400 million, ACM Fund II had raised $286.3 million as of the end of 2016, according to an investor presentation included within the NMSIC materials.

ACM’s previous fund, the ACM Permanent Crops Fund, closed on $250 million in January 2015 after surpassing its initial $200 million target with commitments from investors including the Maine Public Employees Retirement System, the Washington State Investment Board, Aether Investment Partners and others.