The Ontario Municipal Employees Retirement System returned 15.7 per cent for 2021, a significant increase on its 2020 return.
In its annual report, the OMERS said four key factors drove the outperformance relative to its benchmark, which was 6.6 per cent — its portfolio of public equities returned 20.7 per cent; its private equity businesses grew earnings, both organically and through acquisitions, returning 25.8 per cent; its real estate assets earned a 15.9 per cent return and its real estate business, Oxford Properties, continued to expand its global footprint; and its infrastructure investments earned 10.7 per cent.
Overall, the OMERS’ net assets grew to $121 billion at Dec. 31, 2021.
Read: OMERS’ portfolio lost 2.7 per cent, net of expenses, in 2020
“Our strategy of global diversification and a relentless focus on a portfolio of high-quality assets delivered exceptional returns for our hard-working members in 2021,” said Blake Hutcheson, OMERS’ president and chief executive officer, in a press release. “We’re pleased that we exceeded our benchmarks across all segments of our portfolio. And now we look to the future with deep, dedicated international teams and ample capital to deploy in support of our long-term strategies.”
Also in 2021, the OMERS announced a net-zero greenhouse gas emissions goal across its portfolio by 2050, expanding on its initial commitment to reduce the portfolio’s carbon intensity by 20 per cent by 2025.
“OMERS 10-year average net return now stands at eight per cent,” said Jonathan Simmons, OMERS’ chief financial and strategy officer, in the release. “Long-term returns have helped to improve the plan’s funded status, from 86 per cent in 2012 to 97 per cent today, while enabling OMERS to reduce our real discount rate by 50 basis points to 3.75 per cent over the same period.”
Read: OMERS committing to net zero, UPP facing divestment calls from university staff