TRS Louisiana creates $100m AgIS separate account

The investment committee of the Teachers Retirement System of Louisiana has approved the creation of a $100 million separate account with AgIS Capital, a permanent crops-focused farmland manager, according to its deputy chief investment officer.

TRSL’s Maurice Coleman told Agri Investor that at a meeting last month, the $19.5 billion pension also added $25 million to a Hancock Agricultural Investment Group-managed separate account, valued at $33.7 million as of June, according to the TRSL website.

According to an AgIS presentation at the meeting, the separate account will fund between three and five investments of $10 million-$40 million in permanent crops and related production and processing infrastructure. Crops appropriate for investments from vehicle include apples, tree nuts, olives, blueberries and cranberries and are expected to be held for between seven and 10 years.

AgIS’s 10 investment professionals produced a 6.8 percent after fees IRR from inception to June 2018, the firm told the meeting.

The Boston-headquartered firm, which secured a $150 million separate account commitment from the $80.2 billion Virginia Retirement System in late 2017, managed a total of $470 million for three institutional investors as of June, according to Hamilton Lane’s fund summary.

AgIS declined to comment.

During a presentation at the 2019 Peoples Company’s Land Investment Expo, AgIS founder and president Jeff Conrad said US pensions are increasingly viewing farmland as a permanent fixture of their asset mix, rather than an alternative investment brought on by a specific market opportunity.

Conrad stressed that because such pensions are often investing upon the advice of consultants, it can take time for LPs to understand the investment and determine, for example, if they will house farmland investments in a natural resource, real asset or specialized dedicated allocation.

According to TRSL consultants Hamilton Lane, AgIS completed an initial screening in February 2018, responded to an 80 question questionnaire in April and hosted a May site visit before securing Hamilton Lane’s recommendation in August and meeting with pension executives in October.

“Especially with the US pension plans, nothing happens fast,” Conrad said at the late-January conference. “Once you get into the asset allocation mix, you tend to stay there, because just as hard as it was for us to get there, it’s just almost as hard to kick it out.”

In December, TRSL committed $75 million to Apollo Natural Resources III, which includes agriculture among its target sectors.