The Healthcare of Ontario Pension Plan, one of the country’s largest pension funds, returned 8.6 percent in 2013 as real estate and equity investments rallied.
Assets rose to a record C$51.6 billion ($46.9 billion) and investment income was C$4 billion last year, compared with C$6.8 billion in 2012, according to the Toronto-based firm.
The result was below a 17 percent return on investments in 2012 when assets were at C$47.4 billion. HOOPP, as the fund is known, also missed the 14 percent median return for Canadian pension funds in the year ended Dec. 31, according to Royal Bank of Canada’s RBC Investor & Treasury Services unit.
“The results were led by equities -- they did quite well,” Jim Keohane, HOOPP chief executive officer, said by phone today. “Now we’re a bit more cautious on equity markets than we’ve been for the last few years because valuations are high.”
HOOPP’s U.S. equities portfolio returned 28 percent, private equities returned 27 percent, and its real estate holdings gained 14 percent, bolstering the pension manager’s performance in 2013, Keohane said.
The pension manager reached a funded ratio of 114 percent, HOOPP said in a statement today.
HOOPP purchased two shopping centers in Ontario and an office tower in Edmonton, Alberta, last year through partner Morguard Real Estate Investment Trust. The firm also announced it was investing alongside closely-held real estate developer Menkes Developments Ltd. in a new Toronto office property that began construction Jan. 15 last year.
HOOPP oversees retirement funds for about 275,000 nurses, medical technicians, food services staff, laundry workers and other healthcare workers.