OMERS to officially open London office, to accelerate pension's expansion

By The Canadian Press

TORONTO - The Ontario Municipal Employees Retirement System is joining other Canadian pension plans in further expanding its global presence by officially opening an office in London, which will operate as OMERS Worldwide.

The office will be the pension fund's European headquarters, and will be headed up by Paul Brundage, an OMERS executive vice-president, and a 20-member team focused on real-estate, infrastructure, private equity and capital markets in the United Kingdom and Europe.

One of Canada's largest pension funds, OMERS joins the Canada Pension Plan Investment Board, which also opened its London office this year. Meanwhile, the Ontario Teachers' Pension Plan set up its London office in May last year and opened an office in New York this year, and the Caisse de depot et placement du Quebec has offices in Europe, Asia and Latin America.

The four plans combined have more than $437 billion in investments.

OMERS has investments in Associated British Ports, Scotia Gas Networks, and the Watermark Place office complex being developed in London.

The new OMERS Worldwide office at 6 New Street Square has been under construction through the summer and partially operational in recent weeks. It officially opens Wednesday.

As of the end of 2007, OMERS had net investment assets of $52 billion - including 30 per cent in real-estate, private equity and infrastructure.

"Our long term goal is to invest 42.5 per cent of our net investment assets in private markets on a global basis," Michael Nobrega, OMERS president and chief executive, said in a statement.

Like several of Canada's other large pension funds, OMERS has been strategically diversifying its investments beyond bonds and stocks and buying major stakes in businesses that offer the potential for a reliable stream of funds over long periods of time.

"We are weathering the current market crisis largely because we were an early believer in shifting large amounts of capital from public to private markets," Nobrega said.

"Our substantial private market assets have gone a long way toward partially offsetting the volatility and negative performance of public securities."

While investing overseas can be lucrative, fingers can also get burned. In April, the CPP Investment Board's bid to buy a 40 per cent stake in Auckland International Airport was blocked by the New Zealand government.

The government said it wasn't satisfied that all criteria were met under the Overseas Investment Act. The CPP Investment Board said it wouldn't appeal.

At the end of 2007, the OMERS fund was about 60 per cent invested in Canada and 40 per cent in the United States and overseas.

It has said it has about $12 billion in investments outside of Canada, including nearly $4.75 billion in the United States, $3 billion in Europe and $5 billion in the United Kingdom.

OMERS provides retirement benefits to 380,000 members on behalf of over 900 different municipal employers in Ontario