OTPP, which as of year-end 2013 had CAD139bn (€94.4bn) of net investments, has a 22% allocation to real estate.Investments are made through the plan’s Cadillac Fairview subsidiary, which has a North American portfolio of more than CAD23bn.In the UK, OTPP has invested in the country’s HS1 high-speed rail link between London and the Channel Tunnel.Private equity firms PAG Asia and TPG, meanwhile, have both previously invested in the real estate sector.TPG has closer ties to Canadian institutional money, having worked with Ivanhoe Cambridge, the real estate arm of the Canadian pension fund Caisse de dépôt et placement du Québec.The firm, which has invested in real estate since 2009, has also run separate accounts for New Jersey’s state pension fund.It has recently targeted distressed property in Europe.PAG’s Real Estate division manages opportunity and core-plus property funds in Japan and China and across Asia-Pacific.The firm has made both direct and indirect investments in opportunistic, value-added and core-plus real estate.DTZ’s strength in Asia has been noted in previous years by observers, making it an attractive proposition to those looking to increase exposure to the Asia-Pacific region. Ontario Teachers’ Pension Plan, TPG Capital and PAG Asia have agreed a AUD1.2bn (€832m) cash offer to buy property advisory company DTZ.DTZ’s current owner, Australian services firm UGL, said it expected the deal to close in September, resulting in DTZ to change ownership three times in as many years.Prior to going into administration in 2011, DTZ was 52% owned by Saint Georges Participations, controlled by the French Mathy family.UGL managing director and chief executive Richard Leupen said the decision to sell DTZ was due to diverging operational and strategic priorities and financial requirements.
It also manages a separate CHF4bn portfolio for seven closed pension funds with no active members.In this portfolio, the share of domestic bonds stood at 36% – twice as high as in the larger portfolio.A 2.9% return on domestic bonds helped the performance reach a positive 2.1% for 2015 for the retiree portfolio.This return was further aided by a large exposure to domestic real estate, which, at 20%, was almost three times that of the open portfolio.According to Publica, domestic real estate was the best-performing asset class in 2015 at 6.3%.The pension fund noted that, despite last year’s loss, it has still outperformed its benchmarks, Pictet’s BVG indices, by 20bps between 2000 and 2015, with a 2.9% average return.Meanwhile, Swiss companies saw their pension funding decline over the last year as discount rates fell and returns were only just positive, according to the quarterly Willis Towers Watson Swiss Pension Finance Watch.Year on year, funding levels came down from 96.5% to 94.8% after an even lower drop at the end of September to 92.4%.According to Willis Towers Watson, the fact the discount rate remained steady in the last quarter helped prevent a further decline in the funding level.This development was aided by the fact that the overall average return in Swiss company pension funds stood at approximately 1% at year-end.The consultancy’s calculations are based on the returns of Pictet’s BVG-40 pension index with a 40% equity exposure.Other Pictet BVG indices with different underlying asset allocations estimated a much lower return for 2015 at less than 0.5%. Publica, Switzerland’s largest public pension fund, has reported a 2.5% loss on its open portfolio for 2015.In a statement, it cited the negative impact of a 14% exposure to emerging market debt and equities, with director Dieter Stohler also pointing out that emerging market currencies devalued by approximately 11% against the Swiss franc over the period.He said the fund’s decision, however, to hedge developed-markets fully had boosted Publica’s overall return by 130 basis points.Publica manages the open portfolio – by far the largest component of the scheme, with more than CHF32bn (€26bn) in assets – on behalf of 14 other pension funds, including its own.
Chairman of DIP Peter Falkenham said: “In 2018, both the spread of our investments and our risk profile were put to the test. In order to make our investment portfolio as robust as possible, we have composed it of a range of different assets, and in particular our real estate investments have helped to ensure good returns.”Falkenham said the real estate result was achieved partly through positive market conditions but was also the fund’s efforts to develop and optimise the management of its existing property portfolio.“At a time when global equity markets are challenged, the property market shows itself to be stable and over the next few years we expect to increase our real estate portfolio.” he said.Real assets accounted for 16.3% of DIP’s investment portfolio at the end of 2018, up from the 14.8% allocation to the asset class a year earlier.In January, DIP and the Lawyers’ and Economists’ Pension Fund (JØP) bought a stake in a Danish office complex from Sampension in what JØP said was the biggest commercial property deal ever done between pension funds in Denmark.DIP said it was continuing in its talks with JØP about their plans to merge, and had asked its members to vote on the consolidation on 29 April.The pension fund said the merger would place the resulting joint pension fund among Denmark’s top 10 largest funds and give it access to more lucrative investment opportunities. The Danish Pension Fund for Engineers (DIP) plans to grow its real estate portfolio further after the asset class generated a 12.8% return for 2018.The result helped cushion losses in other areas, resulting in a full-year loss of 1.7% on its investment portfolio, according to its annual report.DIP – which is one of two pension funds for engineers in Denmark – described 2018 as an eventful and challenging year for the pensions sector.While total assets remained broadly unchanged at the end of December 2018 from the year before, at DKK41bn (€4.4bn), DIP said that over the past five years they had risen from DKK33bn in 2013.