8.4% infra return for OTPP

Infrastructure outperformed for Ontario Teachers’ Pension Plan (OTTP) in 2012, returning 8.4 percent to best its 8 percent benchmark index, OTTP said in its annual report.

The pension administrator—a direct investor in infrastructure—noted its infrastructure portfolio totaled C$9.6 billion ($9.48 billion; €7.37 billion), compared to C$8.7 billion in 2012.

For OTTP, the return on infrastructure was telling: in 2012, the public pension outperformed across-the-board. 

Teachers’ gained 13 percent overall, compared to its 11 percent target. Equity and fixed income likewise beat expectation, with equity returning 14.2 percent against a 13.1 benchmark, and fixed income claiming a 5.1 percent return set against its 4.5 percent goal.  

Infrastructure, meanwhile, is slotted into a ‘real asset’ portfolio—a bucket OTPP claimed last year gained 14.6 percent versus its benchmark of 10.6 percent.

On a four-year basis, the Plan said, infrastructure posted a 6.6 percent annualised return versus a four-year benchmark of 5.3 percent

OTTP included its 50-year concession of the Sydney Desalination Plant (SDP) as a ‘notable’ transaction for 2012. The Plan, together with Hastings Fund Management, paid A$2.3 billion (€1.8 billion; $2.3 billion) last May for the SDP.

Ending 2012, OTTP has C$129.5 billion under management, up from C$117 billion a year ago.

Meanwhile, Jim Leech, chief executive for Teachers’ has announced he will step down at the end of 2013. A search for a successor has begun.

Leech joined OTPP in 2001 to head private equity, becoming chief executive in 2007. His announcement marked the latest high-level departure for the Plan: Stephen Dowd, senior vice president, infrastructure, left OTPP in March.