Infrastructure is continuing to steady the performance of the Ontario Municipal Employees Retirement System, which reported a return of 10.9 percent for the asset class this year, compared with 8.1 percent in 2008.
Michael Nobrega, OMERS’ president and chief executive officer OMERS: Steady returns
The C$47 billion (€33.3 billion; $45.1 billion) pension had a benchmark for infrastructure of 9.0 percent in 2009, but its infrastructure investment arm – Borealis Infrastructure – topped the benchamrk for the second year in a row. In 2008, OMERS reported a return of 8.1 percent for its infrastructure assets against a benchmark of 7.4 percent. 
The performance of our private equity and infrastructure investments also provided very strong returns, reinforcing our decision to continue to expand our holdings in the private market asset classes.
Gains in OMERS’ private equity and capital market portfolios also boosted the Canadian pension fund. The OMERS Private Equity group reported returns of 13.9 percent in 2009, compared to a benchmark of 6.7 percent. OMERS Capital Markets, the public investments arm of the pension, reported returns of 11 percent against a 13.5 percent target.
Real estate, however, continued to be a drag. The pension had a benchmark for real estate of 6.7 percent in 2009, but its property management arm – Oxford Properties – failed to mirror such gains, reporting instead returns of 1.3 percent last year. In 2008, OMERS reported gains of 6 percent for its real estate assets against a benchmark 8.3 percent. 
on infrastructure
OMERS’ Strategic Investments, which targets global co-investment opportunities across real estate, infrastructure and private equity, was the only portfolio to deliver negative news for the pension, returning -1.2 percent against a targeted return of 10.7 percent.
OMERS said it experienced an overall return of 10.6 percent for all asset classes against a target of 12.1 percent. In 2008, the pension returned -15.3 percent against a benchmark of -13.2 percent.
“The performance of our private equity and infrastructure investments also provided very strong returns, reinforcing our decision to continue to expand our holdings in the private market asset classes,” said Michael Nobrega, OMERS’ president and chief executive officer.
The pension is now valued at C$47.7 billion compared to C$43.4 billion as at the end of 2008. However, Nobrega said the plan’s deficit had increased to C$1.5 billion owing to changes in certain actuarial assumptions making “enhanced investment returns in 2009 and in subsequent years” an important factor in trying to address the deficit going forward.
|
| 2009 | 2008 | ||
| Rate of return | Benchmark | Rate of return | Benchmark | |
| OMERS Capital Markets | 11% | 13.5% | -19.5% | -19.5% |
| OMERS Private Equity | 13.9% | 6.7% | -13.7% | 13.5% |
| Borealis Infrastructure | 10.9% | 9% | 11.5% | 9.8% |
| Oxford Properties | 1.3% | 6.7% | 6% | 8.3% |
| OMERS Strategic Investments | -1.2% | 10.7% | n/a | n/a |
| Total Plan | 10.6% | 12.1% | minus 15.3% | 13.2% |
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