Private equity is OMERS’ best-performing asset class

The asset class’s performance improved in 2016 from the previous year, when it posted a 10% net return.

Private equity was the best performing asset class in 2016 for the Ontario Municipal Employees' Retirement System.

It posted a 12.6 percent net return in the 12 months ended 31 December, up from 10 percent in the previous year, according to a Friday statement from OMERS.

This was followed closely by real estate, which returned 12.4 percent for the year, down from 15.3 percent in 2015, while infrastructure returned 11 percent in 2016, down from 17.3 percent in 2015.

The overall return for the pension plan was 10.3 percent after all expenses, up from 6.7 percent in 2015, the statement said.

“Our strong investment returns in 2016 reflect the value of our well-diversified portfolio of high-quality assets, which we are continuing building,” said Michael Latimer, OMERS president and chief executive.

As of 31 December, OMERS, which has C$85.2 billion ($64.86 billion; €61.33 billion) in total assets, had 13.6 percent of its assets in private equity, down from 14.7 percent. Meanwhile infrastructure became the largest private investment asset class in 2016 for OMERS, representing 17 percent of assets, up 16.4 percent in 2015.

Real estate was the largest private investment asset class in 2015 at 16.9 percent, but it dropped to 14.6 percent in 2016.

Overall, OMERS' total net assets increased by C$8.1 billion during the year.

OMERS Private Equity, which has offices in Toronto, London and New York, is the private equity investment arm of OMERS. It has about $9.7 billion of capital invested in 13 direct control buyouts. 

OMERS Private Equity is part of OMERS Private Markets, which also includes Borealis Infrastructure, its infrastructure investment arm that manages about C$27 billion in assets.