Canadian Pension Board, Allianz Capital Among First to Invest in Indian Private Infrastructure Trust

The anchor investors in the first private infrastructure investor trust in India are the $262 billion Canada Pension Plan Investment Board and the investment arm of Munich’s Allianz insurance companies.

IndInfravit will obtain five operational toll roads in India to start, growing through additional road related infrastructure investments. The roads will be built by Infrastructure Development Projects Limited, IndInfravit’s sponsor.

The toll roads reach across the four Indian states of Karnataka, Telangana, Tamil Nadu, and Rajasthan, which have a combined total population of 238 million people who account to almost one-quarter of the country’s GDP. The roads have been active for about five years.

The Canada pension board will invest C$200 million for 30% of IndInfravit Trust units, of which Allianz Capital Partners recently acquired 25%. Another 15% of the units will be held by L&T. The remaining units have gone to other institutional investors. L&T’s subsidiary will be the investment manager for trust.

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Scott Lawrence, the Canada board’s managing director and global head of infrastructure, said that the Indian economy brings “a need for sound infrastructure, and we are pleased to be able to support this growth while delivering solid long-term, risk-adjusted returns for the CPP Fund.” The fund has been investing in India since 2012.

Christian Fingerle, Allianz Capital’s CIO, called infrastructure a “key driver” of India’s economy. He also praised the fiscal and legal policy framework that helps make those investments attractive to long-term investors. Allianz Capital Partners has approximately $27 billion in assets under management.

In addition, IndInfravit will be listed on the National Stock Exchange of India Limited and BSE Limited. The investment board and Allianz Capital will also take board positions on the investment manager. Both plan to make future investments in Indian road infrastructure.

The Canada board has also entered a joint venture with Singaporean sovereign wealth fund GIC ($359 billion) to buy a Grade A office building in Seoul for 418 billion Korean won ($387 million).

Tags: Canada Pension Plan Investment Board, India, IndInfravit, Infrastructure, Toll Roads

Sean Crawford, CIO, Connecticut
Retirement Plans & Trust Funds

After more than a yearlong search, Connecticut has found its chief investment officer. Sean Crawford, CIO of New York’s Metropolitan Transportation Authority (MTA), will take the helm on May 14.

He’ll have his hands full.
The $34.4 billion Connecticut Retirement Plans & Trust Funds (CRPTF) consists of six state pension funds and nine state trust funds.

CIO Deborah Spalding resigned in February 2017 to become a managing director at Connecticut-based Commonfund, which manages $24.3 billion in assets. Since then, Deputy CIO Laurie Martin, who joined in October 2016—four months prior to Spalding’s departure—has been interim CIO.

Connecticut has been considering strategies to shore up its 55.9% funded teacher’s retirement plan, while it measures impact investing issues such as gun divestment for its plans.

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In May 2017, Moody’s reported Connecticut has the highest debt service costs of the 50 US states, although it declined to 13.3% from 14.3% in the previous year. Its net-tax supported debt (NTSD) is $6,505 compared to the median per capita of $1,006.

Despite the challenges, the CRPTF posted a net investment record return of 14.2% for the fiscal year. The overall portfolio grew by over $3 billion in value during the year.

Connecticut Treasurer Denise L. Nappier credited CRPTF’s robust performance to Martin, who helped to build the investment team and oversaw extensive due diligence during her 18 months at the fund, which led to commitments totaling $1 billion. With Crawford and Martin at the helm, Nappier said the team “is well-positioned to strengthen overall pension fund operations and continue our course toward maximizing long-term performance while guarding against undue risk.”

Crawford is accustomed to forging new frontiers. Three and a half years ago, he became the first CIO of the New York MTA, which operates the largest transportation network in North America. He was responsible for the management, asset allocation, and investment selection of the MTA’s defined contribution (401(k)/457), defined benefit (pensions), health and welfare (OPEB), and insurance assets, with assets under management in excess of $15 billion.

Prior to the MTA, he was a vice president of the financial services firm Brown Brothers Harriman, a director at Barclays, and a vice president at Lehman Brothers. He has 21 years of investment and research experience.

His last day at the MTA was Friday, May 4, and he will begin in Hartford on May 14.

“I am very pleased to be joining Treasurer Nappier’s team and to be working with the talented and dedicated professionals serving the people of the State of Connecticut. I look forward to assisting the Treasurer and the IAC in prudently and sustainably managing the investment programs. The challenging investment environment will require diligence, persistence, and patience as we strive to fulfill the commitments of the pension and the trust funds,” Crawford said in a statement.

Crawford will speak on the “Macro Investing and Political Risk” panel at CIO’s Chief Investment Officer Summit on Thursday, May 10.

Tags: Connecticut, New York City MTA, Sean Crawford