At least three asset consulting gigs remain up for grabs amid a renewed bout of activity in the NZ wholesale investment sector that has seen two decisions finalised in recent weeks.
Auckland-based boutique, Makao Investments, picked up another new client last month as employer-based superannuation scheme, NZ Refining Company, completed a “comprehensive tender process”, according to the fund’s 2023 annual report.
“The appointment is effective from 1 September 2023, to allow a seamless transition from the Fund’s previous advisors, Mercer Investment Consulting,” the NZ Refining report says. “There were no other changes to the service providers during the year.”
However, the employer scheme has seen a major shake-up during the financial year after the Marsden Point refinery switched to an import-only terminal model. Over 40 scheme members were made redundant as the 60-year refining era ended with more than half opting for a pay-out.
Post the restructure, the NZ Refining fund reported just one contributing member and 97 pensioners (either active or deferred) while assets under management fell to $44 million from $64.2 million the previous year on the back of withdrawals and investment losses of -4.8 per cent.
At the consultant hand-over date, scheme managers included ANZ, First Sentier, Harbour, Mercer and Nikko.
Previously one of the largest employers in Whangarei, NZ Refining, now renamed Channel Infrastructure NZ, made about 240 of its 300 staff redundant after closing the Marsden Point refinery operations early in 2022.
In another Northland-based event, EriksensGlobal has retained the investment advisory gig with the regional council in a result that was never really in doubt.
As reported in July, many consultants baulked at the terms of reference for the Northland Regional Council tender for its $70 million development fund, preferring to pass on the offer.
Incumbent EriksensGlobal was confirmed as winner in a recent post on the government tender site.
Meanwhile, it is understood an asset consulting decision looms at another regional council, Waikato, which put out a request for an “independent consultant” to conduct a review of its investment adviser this May.
The $100 million Waikato Regional Council (WRC) fund is currently advised by Mercer with underlying managers including Fisher, First Sentier, Harbour, Mercer (ex Macquarie NZ funds) and Stewart Investors.
Over the 12 month to the end of March 2022 the WRC fund was down about 10 per cent, according to the Council’s annual report.
Further south, much further south, the almost $470 million Central Lakes Trust (CLT) has also triggered a consultant search, according to industry sources, with the view to adopting an implemented investment solution.
Self-described as “the largest philanthropic trust per capita in the Southern Hemisphere”, CLT services the sparsely populated but well-heeled central Otago and Queenstown lakes districts.
The has about $305 million invested in a diversified portfolio, advised by Melville Jessup Weaver, with the remainder held in shares of Pioneer Energy.
In March this year, former Otago Community Trust chief, Barbara Bridger, took the helm at CLT.
And finally, back up north, the Massey University Foundation also, reportedly, has the feelers out for an investment adviser.
The $56 million Massey Foundation fund, which supports academic research and scholarships, currently invests in three underlying managers – Continuity Capital (private markets specialist), Milford and Nikko.
During the 2022 calendar year, the so-called Massey ‘Endowment Investment Pool’ was down 12 per cent.
“Statistically, the Foundation’s investments are expected to lose money about once every six years. The Foundation’s fund has actually performed much better than that,” the fund’s 2022 report says, citing since-inception (in 2004) annualised returns of 8 per cent.
While investment returns detracted last year, the Massey Foundation was bolstered by donations of almost $10 million including a single gift of $1.8 million. As well as individual donors, the Massey fund is regularly boosted from university-related activities where academics, and/or departments, share some proceeds from the sale of intellectual property generated in-house.
Bryan Mogridge, appointed as Foundation chair in February last year, says in the report:
“The Foundation has ambitious plans to have assets of $100 million by 2027 – the centennial anniversary of Massey. Assets of this size properly managed should allow it to contribute at least $5 million of income back to the university each year.”
A Massey alumni, Mogridge is a seasoned NZ independent director, known in financial services for his brief turn as chair of the George Kerr-associated Pyne Gould Corporation.