UK - State Street Global Advisors is facing a review at the £2.1bn (€3.2bn) City of Edinburgh Council Lothian Pension Fund, which is looking to appoint a fund manager for its £125m multi-asset Scottish Homes portfolio.

Scottish Homes was the national housing agency for Scotland but it transferred to Communities Scotland in 2001.

The portfolio has declined in value - although it's only being re-tendered because State Street has come to the end of its term, a spokesperson for the fund said.

"It is a standard procedure and State Street may prove best placed to continue the role," she commented.

The appointed manager will be asked to provide the fund with a series of pooled funds investment vehicles for the management of the assets.

The fund manager "will have absolute discretionary powers to invest the portfolio in global equities, UK index-linked gilts and UK gilts within the parameters agreed by the council officials," the Scottish council said.

The mandates covers enhanced indexed equities and passive fixed income. It calls for a return of 0.5%-1% a year above benchmark.

Between five and 15 operators will be invited to tender or participate for the contract with a duration of a maximum of six years, according to the fund.

The tender will go to "the most economically advantageous tender", with a ten year performance record being one of the nine additional factors, the council said.

The deadline for receipt of tenders or requests to participate is September 11.

Lothian Pension Fund, advised and assisted in the tender by consulting firm Hymans Robertson LLP took on the Scottish Homes Fund in 2005.  It is a mature, non-active fund run as a passive mandate.

Last month, IPE reported that the Lothian scheme tendered a €332m fixed income brief, as part of a normal review process.

Topics