By Muskan Arora
The $115.4B Massachusetts Pension Reserves Investment Management Board has tapped StepStone Group as its next private equity advisor, effective July 2026, replacing incumbent Hamilton Lane.
Hamilton Lane, which has served as the pension’s advisor under the current contract set to expire next year, did not submit a proposal for the new advisory request for proposal. Instead, the firm responded only to the database portion of the request, signaling a shift in business focus, according to Michael McGirr, director of private equity at MassPRIM, at the recent investment meeting.
McGirr noted that the pension’s existing program with Hamilton Lane, known as the “Future Initiative,” is approaching the end of its investment period. MassPRIM is “in process of transitioning to another provider in terms of thinking about a solution for new capital commitments for that future initiative,” added McGirr.
In selecting StepStone, McGirr cited the firm’s extensive market coverage, ability to deliver both advisory and data services, as well as its stability and transparency.
MassPRIM launched the RFP process in March and received seven responses for each of the advisory and database mandates. Finalists for the advisory role included Aksia, Albourne, Cambridge Associates, and StepStone. For the database services, the shortlist included Hamilton Lane, Cambridge Associates, Albourne, and StepStone. Finalist interviews were conducted on June 9.
The evaluation committee for the search included Investment Committee member Constance Everson, alongside McGirr, Helen Huang, Maria Garrahan, Shannon Ericson, Jessica Murphy, and Katherine Kovach.
MassPRIM reported a 6.9% net return for its private equity portfolio over the past year. Small- and mid-market buyouts were the top performers, followed closely by large and mega buyouts, as well as growth equity and venture capital strategies, McGirr said.
Separately, at Tuesday’s investment committee meeting, chief investment officer Michael Trotsky reported a 9.6% return for the fiscal year ended June 30, 2025. While the result lagged the fund’s primary benchmark of 10.9%, it slightly outperformed a new implementation benchmark of 9.5%.
MassPRIM oversees the Pension Reserves Investment Trust (PRIT) Fund, a pooled investment vehicle that includes the Massachusetts State Employees’ Retirement System, the Massachusetts Teachers’ Retirement System, and other state, county, and municipal retirement systems.
Over the past three, five, and ten years, the PRIT Fund has delivered annualized returns of 8.2%, 9.7%, and 8%, respectively. That compares with benchmark returns of 10.1%, 8.9%, and 7.6% over the same periods.
For its one year returns, hedge funds returned 9.4%, value-added fixed income returned 8.2%, global equity at 5.6%, core fixed income at 3.4% and timber at 3.2%.
Each major asset class met or exceeded its benchmark, Trotsky said — except for global equity and real estate, which missed their targets of 16% and 1.4%, respectively.
Trotsky attributed the equity underperformance to a larger allocation to small-cap stocks and less exposure than the benchmark to the so-called “Magnificent Seven” technology stocks, which have been key drivers of returns in recent years.
