Macy's 2015 Annual Report Download - page 83

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
F-34
Real estate investments include several funds which seek risk-adjusted return by providing a stable, income-driven
rate of return over the long term with high potential for growth of net investment income and appreciation of value. The
real estate investments are diversified across property types and geographical areas primarily in the United States of
America. Private equity investments have an objective of realizing aggregate long-term returns in excess of those available
from investments in the public equity markets. Private equity investments generally consist of limited partnerships in the
United States of America, Europe and Asia. Private equity and real estate investments are valued using fair values per the
most recent financial reports provided by the investment sponsor, adjusted as appropriate for any lag between the date of
the financial reports and the Company’s reporting date. Hedge fund investments seek to provide strong downside
protection qualities and to produce long-term risk-adjusted returns with low volatility through active asset management
among a select group of U.S. and non-U.S. investment partnerships and companies, managed funds, separately managed
accounts, securities and commodities held in segregated accounts and other investment vehicles.
Due to the nature of the underlying assets of the real estate, hedge funds and private equity investments, changes in
market conditions and the economic environment may significantly impact the net asset value of these investments and,
consequently, the fair value of the Pension Plan’s investments. These investments are redeemable at net asset value to the
extent provided in the documentation governing the investments. However, these redemption rights may be restricted in
accordance with the governing documents. Redemption of these investments is subject to restrictions including lock-up
periods where no redemptions are allowed, restrictions on redemption frequency and advance notice periods for
redemptions. As of January 30, 2016 and January 31, 2015, certain of these investments are generally subject to lock-up
periods, ranging from two to fourteen years, certain of these investments are subject to restrictions on redemption
frequency, ranging from daily to twice per year, and certain of these investments are subject to advance notice
requirements, ranging from sixty-day notification to ninety-day notification. As of January 30, 2016 and January 31, 2015,
the Pension Plan had unfunded commitments related to certain of these investments totaling $96 million and $115 million,
respectively.
The Company does not anticipate making funding contributions to the Pension Plan in 2016.
The following benefit payments are estimated to be paid from the Pension Plan:
(millions)
Fiscal year
2016.................................................................................................................................... $ 377
2017.................................................................................................................................... 319
2018.................................................................................................................................... 302
2019.................................................................................................................................... 264
2020.................................................................................................................................... 256
2021-2025........................................................................................................................... 1,176