CPPIB Posts 7.8% Return as Assets Hit $575B, Data Centre Bets Grow

The Canada Pension Plan Investment Board reported a 7.8 percent net return for the fiscal year to March as net assets climbed 11 percent to C$793.3 billion ($575.2 billion), with the Toronto-based giant’s real assets portfolio outpacing the total fund over five years despite weak Asia Pacific performance.

The C$78.9 billion increase in net assets consisted of C$56.9 billion in net income and C$22 billion in net transfers from the Canada Pension Plan, CPPIB said Thursday in a release. The fund’s 10-year annualised net return stood at 8.8 percent.

Public equities drove the fiscal year’s gains, especially US tech and communication services stocks, while real assets — including real estate, infrastructure and energy — also made a meaningful contribution alongside credit, according to the pension fund manager.

“These results reflect the strength of our diversified portfolio and the reach of our global investment platform,” said CPPIB president and CEO John Graham. “By staying disciplined and investing for the long term, we continued to build value for generations of CPP contributors and beneficiaries.”

Digital Drive

Real assets generated an annualised net return of 7.9 percent for the five years to the end of March, beating the total fund’s 6.6 percent return over the same period and trailing only private equities at 9.1 percent and public equities at 8.9 percent among CPPIB’s asset classes.

Asia Pacific remained the laggard among CPPIB’s geographic markets, posting a 2.6 percent annualised net return over five years, compared with 10.2 percent for Latin America, 8.7 percent for the US, 4.9 percent for Europe and 4.5 percent for Canada.

APAC accounted for 18 percent of CPPIB’s portfolio at the end of March, while real assets made up 20 percent of the fund’s holdings, according to the annual results presentation.

CPPIB’s biggest APAC activity during the year came in digital infrastructure, led by a $1.3 billion commitment to Japan DC Partners I, a data centre development partnership managed by Ares Management following its acquisition of GLP’s ex-China fund business. Ares announced the final close of the Japan fund in June with $2.4 billion in equity commitments, with the vehicle targeting three Greater Tokyo campuses set to deliver 240 megawatts of IT load.

The Japan commitment expanded a regional digital infrastructure push that accelerated after CPPIB took a 12 percent stake alongside Blackstone in the $16.1 billion buyout of data centre operator AirTrunk in late 2024. CPPIB also joined Dutch pension managers PGGM and APG, CBRE Investment Management and a Middle Eastern investor last July in backing Goodman Group’s $2.7 billion Hong Kong data centre partnership, seeded with six assets totalling 325MW.

Outside Asia Pacific, CPPIB and Goodman in December launched a 50:50 European data centre venture with an initial $3.9 billion commitment to build four facilities in Paris, Frankfurt and Amsterdam, forming part of a broader $14 billion development initiative.

After the fiscal year-end, CPPIB added to its Australia exposure with a A$76 million ($55 million) equity investment in NextDC, acquiring shares as part of the Brisbane-based data centre operator’s A$1.5 billion entitlement offer to fund expansion tied to a surge in contracted capacity. The capital plan followed a separate A$1.7 billion hybrid securities commitment from fellow Canadian pension player La Caisse.

HQ on the Market

Beyond data centres, CPPIB committed $162 million to a Japan hospitality strategy managed by Singapore-based SC Capital Partners, with the January deal giving the Canadian investor exposure to a hotel market buoyed by inbound tourism and domestic demand.

In India, IndoSpace Core — CPPIB’s joint venture with industrial platform IndoSpace — acquired six logistics parks in November for INR 30 billion ($336 million), with CPPIB committing INR 14 billion to fund the acquisition of assets spanning 9 million square feet (836,127 square metres) across Bengaluru, Chennai, Delhi, Mumbai and Pune.

The fresh APAC real estate bets come as CPPIB weighs trimming other regional exposure, with Bloomberg reporting in March that Canada’s largest pension fund was looking to sell $1.5 billion in Asia private equity fund stakes from mid-2010s vintages.

CPPIB is also seeking a buyer for its downtown Toronto headquarters complex at 1 Queen Street East and 20 Richmond Street East, with CBRE marketing the 503,930 square foot property after the pension fund acquired the asset in 2013.