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Ontario  + Canada + Cross Border News  + Finance  | 
The Ontario Teachers' Pension Plan's real estate portfolio value declined 5.9% in 2023.

Ontario Teachers’ RE Valuations Take Hit

The Ontario Teachers’ Pension Plan’s real estate portfolio value declined 5.9% in 2023.

Teachers’ adjusted the real estate and infrastructure portfolio valuation due to higher interest rates and “:asset-specific events that negatively impacted select investments,” the pension plan’s board said in a news release.

Infrastructure assets fared better as their total valuation dropped a relatively modest 2.8%. But the real estate and infrastructure properties fell far short of their respective 2% and 7.6% growth benchmarks.

Jo Taylor, the pension plan’s president and CEO, said the higher interest rates and real estate and infrastructure asset value declines contributed to the overall pension fund’s underperformance. The total fund value only increased 1.9%, well below its 8.7% growth benchmark.

β€œThe prognosis for real estate, to me, remains pretty challenging,” Jo Taylor, told the Globe and Mail.

He indicated that Teachers’ will lean more towards infrastructure investments outside of Canada because opportunities here are limited and returns are smaller.

Taylor said the higher rates and real estate and infrastructure asset value declines contributed to overall fund’s underperformance. The total fund value only increased 1.9%, well below its 8.7% growth benchmark.

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Joe TaylorOntario Teachers' Pension Plan Board

About Monte Stewart

Monte Stewart serves as Content Director - Canada for Connect Commercial Real Estate. Based in Vancouver, British Columbia, Monte provides daily news coverage of major Canadian commercial real estate markets, including Vancouver, Toronto, Montreal and Calgary. He has written about the real estate sector for various media outlets and Avison Young since the early 2000s. In addition, he has covered sports, general news and business for several leading wire services and publications, including The Canadian Press, The Associated Press, The Calgary Herald, The Globe and Mail, Research Money, The Daily Oil Bulletin, Natural Gas World and The Toronto Star. Monte is active in his community as a youth basketball coach and raises funds for such charitable causes as Movember.

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