Canadian pension fund Caisse de depot et placement du Quebec has recently moved into its new London headquarters as it is working to deploy C$15 billion ($11.2 billion) in private markets across Europe.
David Morley, managing director and head of Europe for the C$402 billion pension fund, said the team moved into the new office in January, doubling the size of its office space.
“We see London strategically as the hub for Europe,” Mr. Morley said, adding that the pension fund wants to be able to accommodate more investment staff. The fund could grow its staff of London-based investment professionals to about 100 from 60 by adding origination experts and private asset managers.
“The U.K. is our biggest investment destination outside of North America,” Mr. Morley said.
“It’s not surprising because of the long-standing connections and cultural affinity,” he said, adding that CDPQ also operates a “busy office” in Paris because France also continues to play an important role in terms of real estate and infrastructure investments for the fund.
Mr. Morley said that Europe presents an opportunity to source assets in health care, technology and renewable energy. CDPQ currently invests about 16% of all assets in the region. Asset class breakdown of European investments was not provided.
The fund’s focus is on themes such as business services, health care, technology, financial services, real estate, social mobility and transition to a low carbon economy.
“Europe is attractive on a macro-economic level from our point of view. It’s really clear that Europe is leading the green debate, so the direction of travel is quite supportive of green assets, green investments. That’s not true everywhere in the world,” Mr. Morley said. Commenting on investing in real assets to protect against inflationary pressure, he said that CDPQ expanded its investments in infrastructure globally to some C$45 billion dollars allocation from about C$15 billion dollars five years ago.
“Infrastructure is one part how you deal with inflation. It’s not a coincidence that we have been expanding in infrastructure over the last five years,” Mr. Morley said.
“We are thinking about the kinds of assets we need to generate the returns. Europe has a long-term growth prospect because of the rule of law, the stability of markets, the familiarity, and private markets are very well-developed, particularly infrastructure compared to other places in the world,” he noted.
