Infrastructure investments led the Ontario Municipal Employees Retirement System’s 2.2% return in the first half of 2025, which raised the pension fund’s assets to C$140.7 billion ($101.7 million) as of the end of June, up from C$138.2 billion six months earlier.
The pension fund’s infrastructure assets earned 3.6% during H1, followed by private credit and public equities, which earned 2.7% and 2.4%, respectively. Government bonds returned 2.1%, while public credit and real estate provided gains of 1.6% and 1.1%, respectively. Private equity was the only asset class that did not provide a return, losing 1.3% for the first six months of the year.
“Private equities were held back as investor confidence remains challenged and markets continue to exhibit very low levels of activity,” OMERS stated in its mid-year report. “As a result, valuations continue to be impacted by slow earnings growth and headwinds within certain industry sectors.”
According to OMERS, the more-than-5% decline in the U.S. dollar in H1 “meaningfully detracted from our returns across asset classes, particularly in public and private equity.” However, the pension fund’s leaders also said that hedging its currency exposure added nearly 1% to the portfolio: “This currency management strategy, combined with our diversification in the British pound sterling and euro, mitigated the otherwise negative impact on the portfolio.”
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“Currency had an overall negative 1.2% impact on our results, driven by a significant decline in the U.S. dollar, and partially offset by strengthening of the British pound sterling and euro,” OMERS Chief Financial and Strategy Officer Jonathan Simmons said in a statement.
OMERS’ infrastructure investments were also the fund’s largest asset allocation at 22%, with 19% public equities, 19% private equities, 15% real estate, 14% public credit, 13% private credit, 10% government bonds, with negative 12% reported in cash and funding.
By geography, 55% of the fund’s assets are in the U.S., with 18% in Europe, 16% in Canada and 11% in the rest of the world, as of June 30.
OMERS also reported five- and 10-year annualized returns of 8.7% and 6.9%, respectively.
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Tags: Asset Allocation, Infrastructure, OMERS, OMERS Infrastructure, Ontario Municipal Employee Retirement System
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