North Dakota Boosts In-State Investments Through Legacy Fund Expansion

bismarck, ND – The State investment Board (SIB) is considerably increasing its commitment to North Dakota’s economic growth by expanding the Legacy Fund’s in-state investment program. The SIB has brought on GCM grosvenor, a global firm specializing in alternative asset management, to oversee real asset investments. Additionally,the board has increased its financial commitment to 50 South Capital,which manages the program’s private equity and venture capital investments,reinforcing its dedication to fostering local businesses and innovation.

New Investments to Boost North Dakota’s Economy

The North Dakota Retirement and Investment Office,responsible for managing the program,aims to generate competitive returns by strategically investing a portion of the Legacy Fund within the state. This initiative is designed to support local opportunities and drive economic development. According to the North Dakota Office of the State Treasurer, the Legacy Fund was established to provide long-term economic benefits for the state.The fund was created in 2010.

Did You Know? The Legacy Fund was established after North Dakota voters approved a constitutional amendment in 2010, dedicating a portion of oil tax revenues to the fund.

GCM Grosvenor to Manage Real Assets

GCM Grosvenor will spearhead the new real assets mandate with an initial commitment of $150 million, which will be deployed over the next three years. These real assets will encompass investments in sectors such as real estate, infrastructure, natural resources, and agriculture, providing a diversified approach to supporting North Dakota’s economy.

Increased Support for Private Equity

earlier this year, the SIB demonstrated its confidence in the North Dakota Growth Fund by increasing its commitment to 50 South Capital from $100 million to $250 million. This significant increase will further bolster North Dakota businesses and entrepreneurs through targeted private equity investments. The anticipated pace of these investments is projected to be between $30 million and $40 million annually.

Pro Tip: Diversifying investments across multiple sectors can definitely help mitigate risk and ensure a more stable return on investment.

Legacy Fund’s Current In-State Investments

As of March 31, the investment board reported that over $500 million of the $11.9 billion Legacy Fund has already been invested within North Dakota. 50 South Capital has committed $111.5 million across seven funds and four direct co-investments, supporting 23 North Dakota businesses. Additionally, fixed-income investments through the Bank of North Dakota total $391 million, including nine Match Loans valued at $299 million and 23 Infrastructure Loans valued at $92 million.

Looking Ahead

Established in 2021, the in-state investment program is guided by a Legacy Fund investment policy adopted in July 2023. This policy targets $600 million for in-state equity investments and $700 million for in-state fixed income. However,a pacing analysis projects that it will take until 2030 to fully achieve this mandate. All investments made through the program must be managed by autonomous, third-party managers, ensuring transparency and accountability.

What impact do you think these investments will have on North Dakota’s economy? How can local businesses best leverage these opportunities?

Stay informed about North Dakota’s economic development! Share this article and join the conversation in the comments below.