(Bloomberg) -- One of the biggest US public pensions lost most of its private equity team after the fund made changes that would crimp the group’s ability to allocate to the alternative asset class.

Four members of the Pennsylvania Public School Employees’ Retirement System private equity investing team are retiring or have accepted new jobs, according to people with knowledge of the matter. 

The pension’s director of private equity and co-investments, Darren Foreman, will retire in January, while Patrick Knapp, Tony Meadows and Philip VanGraafeiland are pursuing new opportunities, according to some of the people. 

Susan Oh, a director who has been at the pension fund for almost 29 years, is also leaving, people with knowledge of the matter said. Oh, who has focused on equity bets and currency hedging, most recently specialized in sustainable investing through a role in culture and transformative innovation, according to her LinkedIn profile.

The pension said it doesn’t comment on personnel-related matters, though a spokesperson said it has 63 investment professionals on the staff, a dozen of whom are primarily responsible for private markets. Departing members of the investment team declined to comment or didn’t immediately respond.

The Pennsylvania school pension had about $76 billion of assets as of Sept. 30. Private equity accounted for about $12 billion of its portfolio as of March 31, according to its asset-allocation report. That included funds managed by Apollo Global Management Inc., Bain Capital and Cerberus Capital Management.

‘Very Skeptical’

Private equity has performed well for the pension, delivering an almost 13% annualized return over the 10 years through March — the highest of any asset class, according to the fund’s most recent quarterly performance report. 

But that has left it with a higher allocation to the asset class than its target, and the fund has said it will invest less in private equity to lower the proportion from 17% to the targeted 12%. 

That overallocation puts the fund in the same position as other public pensions that are pulling back on private equity and creating a difficult fundraising environment for many buyout firms. 

“I’m very much skeptical about private assets,” PSERS Chief Investment Officer Benjamin Cotton recently told the Philadelphia Inquirer. “You should earn a premium for locking your money into non-traded assets.”

Cotton’s statement related to “an aversion to paying premium fees without earning a premium return on the investment, regardless of asset class,” a PSERS spokesman said Thursday.

(Updates with additional staff departure in fourth paragraph.)

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