January 13, 2015 — 5:20 PM EST
The Caisse de Depot et Placement du Quebec will seek to replicate the expansion of its Ivanhoe Cambridge property unit by developing and operating infrastructure assets globally over the next decade.
Quebec Premier Philippe Couillard today appointed the Caisse to plan, finance and manage new infrastructure projects in Canada’s second-most populous province in a bid to ease the financial burden on the government. Quebec has identified two key projects, including a transit link from downtown Montreal to the city’s main airport, which the Caisse will study before deciding whether to take on responsibilities such as project planning and financing.
“It’s a start in the home market, to demonstrate some capability to the global market,” Caisse Chief Executive Officer Michael Sabia said in a telephone interview from Montreal. “On the basis of that, we will take the model to the global market, where we are convinced there is going to be substantial demand to work with a large, financially stable global investor who has this kind of expertise.”
Under the Caisse’s ownership, Ivanhoe Cambridge has expanded from about C$1 billion ($837 million) of shopping center assets in 1990 to more than C$40 billion of office buildings, malls and residential properties across the globe. That’s the model for CDPQ Infra, as the new Caisse infrastructure unit will be called.
Already an owner of about C$10 billion of assets such as ports, power transmission in countries including Australia, France and the U.S., the Caisse is convinced operating new infrastructure will allow it to bolster returns, Sabia said. Infrastructure returned about 11 percent for the Caisse in 2013, taking its four-year return to 17 percent.
In the U.K., the Caisse is a shareholder in Heathrow Express, the rail service that links London’s Paddington Station to Heathrow Airport.
As of June 30, the Caisse had net assets of C$214.7 billion. It ranks as Canada’s second-largest pension fund manager.[...]
