The Ontario Municipal Employees Retirement System plans to add at least $10 billion in new Canadian investments over the next five years, signalling a shift toward more domestic capital deployment.

OMERS’ plan has broad implications for Canadian infrastructure investments as the federal government incentivizes them.

Blake Hutcheson, the CEO of OMERS, told The Globe and Mail that the pension plan is targeting an increase in its Canadian allocation to 25% of its $145-billion portfolio, up from about 18% today.That would build on roughly $26 billion already invested domestically and mark one of the first explicit targets set by a major Canadian pension fund to boost homegrown exposure.

OMERS’ existing Canadian holdings include a stake in Bruce Power, ownership of Teranet, and real estate assets such as Yorkdale Shopping Centre in Toronto and Fairmont Banff Springs in Banff, Alta. The pension plan also indirectly holds a 5% interest in Maple Leaf Sports and Entertainment.

The move comes as Canadian governments push pension funds to invest more domestically, with roughly three-quarters of the $2.6-trillion managed by the country’s largest plans currently invested abroad. Pension executives have maintained their mandate to pursue the best risk-adjusted returns globally, while noting a limited supply of large-scale opportunities in Canada, the Globe reported.

Hutcheson told his Globe interviewer that conditions are improving.

“What’s really changed is the conditions that are being created are much better,” he told the Globe. “There’s more in the window.”

OMERS is actively pursuing opportunities in infrastructure, real estate, defence and growth capital for startups, the Globe reported The fund has also adjusted its internal asset allocation models to favour Canadian investments.

Hutcheson told the Globe that the additional $10 billion would be incremental to current holdings and, with leverage, could translate into “$20-billion of firepower” deployed domestically “under the right conditions.”

“In recent months, my whole posture has changed, and we are very open to a lot more in Canada,” he said in the interview with the Globe.

He praised all levels of government for improving their engagement with the private sector, adding that they are emphasizing “partnership with opportunity” rather than “expectation without opportunity.”

Federal efforts include faster approvals for major projects and investment promotion abroad led by Prime Minister Mark Carney and Finance Minister François-Philippe Champagne.

“We are in the room, and I’ve personally been in the room more in the last six months than I have been in the last six years,” Hutcheson told the Globe.

While some business leaders remain concerned that increased dialogue has yet to translate into significant project starts, Hutcheson pointed to rising activity, particularly in real estate, the Globe reported. He cited the 13% HST rebate on new homes in Ontario, municipal-fee reductions and faster permitting as key catalysts.

“In the infrastructure sector, we’ve been in more bake-offs or [requests for proposals],” he told the Globe, while noting emerging opportunities in defence, albeit with some areas remaining off-limits.

“The message that I’ve repeatedly shared is: Stop mixing and start painting,” Hutcheson told his interviewer. “In recent months, we’re seeing the painting.”

He added that global uncertainty is also enhancing Canada’s relative appeal as “a bigger risk premium” in other markets, including the U.S., and expectations of a stronger Canadian dollar, encourage more domestic investment.

But Hucheson told the Globe that OMERS remain risk-averse to brownfield investments, and the pension plan is not waiting for the federal government to head other institutional investors’ request to sell government-owned assets.

Ultimately, he told the Globe, governments are “planting seeds” for investment, so OMERS is “leaning in”

“Do I want people to move faster? For sure,” he told the Globe. “Do I want the tax regimes to be more enticing and catalytic? Of course. Do you want regulations to get out of the way in service of getting our economy kick-started? They can always do more.

“But on all three fronts, we’re seeing more than we have in a long time.”