“Petya brings to her role, leading Infrastructure investments within the Bureau of Asset Management at the Office of the NYC Comptroller, a depth of experience and subject matter expertise that has been cultivated over many years. She has designed and constructed a high-performing portfolio where one did not exist prior to her arrival. She has also built a strong team, which she continues to lead and mentor, to support all efforts in the asset class. Furthermore, Petya’s contributions extend well beyond the Infrastructure asset class. As an Investment Committee member, she has proven to be insightful, analytical, and a critical thinker. She is one to naturally drive the discussion to focus on the key matters in order for the group to reach decisions.”
—Alex Doñé, Deputy Comptroller-Asset Management and CIO, Office of New York City Comptroller Scott M. Stringer (NYC Pensions)
Leading the way for the nation’s third-largest pension fund and its engagement with one of the fastest-growing asset classes in the market, Head of Infrastructure Investments at the Office of the NYC Comptroller (NYC Pensions) Petya Nikolova is a stalwart advocate for the industry as infrastructure returns prove how beneficial for the overall portfolio this asset class could be. She led the development of the pension’s infrastructure asset class that is inclusive of a wide range of infrastructure sectors including power, midstream, renewables, transportation, water, and waste, among others.
Nikolova has over 15 years of experience in infrastructure investments, having spent the last seven years at the Office of the NYC Comptroller, and prior to that, working as director of Americas infrastructure at WestLB, vice president of project finance at the Bank of Ireland and vice president of global energy and transportation at MBIA.
Her strategy is to venture into the market primarily with fund-level investments, and then segue into co-investments as the asset class matures. Nikolova explores with CIO her track record of building the infrastructure portfolio and generating returns within a relatively new asset class.
CIO: What makes 2019 an interesting investing climate? How are you handling it?
Nikolova: 2019 is the 10th year of a bull market that has resulted in high valuations across asset classes. I spend a lot of time thinking about manager selection and understanding how a manager could add value to the assets at different stages of the economic cycle.
CIO: After this year, what are the largest opportunities and the largest threats you see on the horizon?
Nikolova: In my view, the largest opportunity, as the cycle turns, will be to acquire good assets that did not have the right ownership or structure. The biggest threat over the next few years will be when the desire to deploy quickly trumps the discipline in investing.
CIO: How did you arrive at your current position? And why did you choose this part of the financial services industry?
Nikolova: Joining the Bureau of Asset Management in the Comptroller’s Office presented a unique opportunity to build a new portfolio in a new asset class while also contributing to the safe retirement of teachers, policeman, firefighters, and all other public employees who play such an important part in our daily lives.
CIO: What was the most important strategic allocation in your career?
Nikolova: While there have been a number of important allocations, for example, to secondaries and to emerging markets, I would say that the most important one has been the allocation to co-investments. Co-investments will diversify the way we access the market and will allow us to achieve a greater control over portfolio construction, better economic terms as well as improved knowledge transfer.
CIO: Tips for money managers who want to work with you, especially what not to do.
Nikolova: Be transparent. Don’t hide your past mistakes. Own them and demonstrate the changes you have made so that they are not repeated.
CIO: Biggest goof a money manager has made with you?
Nikolova: Our infrastructure portfolio is young and a big goof is still to come.
CIO: Who in the financial world would you like to have lunch with and why?
Nikolova: It would be William D. Nordhaus and Paul M. Romer, who have shared a Nobel Prize for integrating climate change and technological innovations into long-term macroeconomic analyses. Climate change and technological innovation will continue to have a transformational impact not only on markets and investments, but on every aspect of our lives.
CIO: What are changes you’d like to see the institutional investing community make in 10 years?
Nikolova: I’d like to see a more equitable sharing of the upside and the downside between LPs and GPs.
CIO: What are your hobbies (not related to your profession)?
Nikolova: I have always had an interest in exploring different cultures. Most recently, I have been doing that through learning how to dance to the rhythm of samba, bhangra, and West African music. The most exciting part of this adventure is being able to share it with my 6-year-old son.
