OMERS Returns 8.3% in 2024, Assets Grow to $96.67B

The Ontario Municipal Employees’ Retirement System, the pension plan for municipal sector employees in the Canadian province of Ontario, announced Monday that the fund achieved an 8.3% return on its investments in 2024, exceeding its benchmark of 7.5%.

Assets of the pension fund grew to C$138.2 billion ($96.7 billion) at the end of 2024, up from C$128.6 billion at the end of 2023. The pension fund’s funded status increased to 98% from 97%.

Equities were the fund’s highest-performing asset class, followed by private credit. The asset classes returned 18.8% and 12.6%, respectively. Next was private equity, which returned 9.5% in the calendar year. Infrastructure returned 8.8%, public credit returned 6.0%, and government bonds returned 1.0%. Real estate, the fund’s only negative-performing asset class, returned negative 4.9%.

“OMERS public equity investments delivered double-digit performance supported by strong contributions from private credit and infrastructure,” said Jonathan Simmons, the OMERS chief financial officer and chief strategy officer, in a statement. “Our net investment results benefitted from our active strategy to maintain currency exposure to the U.S. dollar.”

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The fund allocates 23% of its portfolio to infrastructure, 20% to both public equity and private equity, 13% to real estate, 12% to both public credit and private credit, 9% to government bonds and 9% to cash and funding. The OMERS asset mix includes physical and derivative exposures, according to the fund’s 2023 report. The fund includes its net economic derivative exposure within each asset class and presents a corresponding offset in the cash and funding category.

“Our real estate assets continue to generate strong operating income, but returns were held back due to lower valuations. Our asset mix continued to shift toward a higher exposure to fixed income, where return opportunities remain attractive,” Simmons continued in the statement. “We expanded our overall use of leverage as we continued to use debt prudently to enhance our investment returns.”

Geographically, approximately 53% of the fund’s assets were invested in the U.S., as of December 31, 2024. Another 19% of the fund’s assets were invested in Canada, with another 17% in Europe. Asia-Pacific and the rest of the world accounted for 11% of all assets.

OMERS also announced the carbon intensity of the investment portfolio has been reduced by 58% from 2019 portfolio emissions. The pension fund also increased its green investments to $23 billion last year; OMERS aims for $30 billion in such investments by 2030.

The Toronto-based fund counts 640,000 members across 1,000 employers, including union and nonunion municipal employees and employees of school boards, local boards, emergency services, transit systems, children’s aid societies and electrical utilities in Ontario.