Infrastructure a boon for OTPP portfolio

The Ontario Teachers’ Pension Plan (OTPP) credited its infrastructure portfolio with a 7.7 percent return, marking the asset class as an top performer for the $117 billion pension fund.

OTPP compared the return with a 6.1 percent benchmark for $176.9 million in added value. Net, the plan said its asset base reached an “all-time high” in 2011, with its 11.2 percent rate of return adding to its managed capital. The OTPP pointed out its strong performance staved off a “crisis of confidence and market volatility” resulting from the debt crisis in Europe.

Overall, the pension fund earned 1.4 percent above its 9.8% benchmark, or $1.4 billion in value added return, while active management added $53 billion since its 1990 inception.

In breaking down its infrastructure portfolio, the plan said timber totaled $2.1 billion at year-end compared to $2.2 billion in 2010, returning 0.8 percent in 2011, compared to the 10.2 percent benchmark.

OTPP, “the largest single-profession pension plan in Canada,” has been a pioneering direct investor in infrastructure.