Pensionscasse Thurgau (pktg), the Swiss pension fund for employees of canton Thurgau with total assets worth CHF 4.75 billion (approx. (ILS). This is a result of increased climate risks such as flooding and hurricanes, it said in its first sustainability report for 2023/24.
At the same time, pktg added that it has also begun reducing its allocation to real estate globally, prioritizing affordable housing and taking into account cyclical and climate risks (including in coastal regions).
The plan also revealed that it recalibrates ILS cuts by increasing infrastructure investment. In the first half of this year, infrastructure investments increased to CHF 360 million, equivalent to approximately 7.1% of total assets.
The pension fund has partnered with Energy Infrastructure Partners (EIP), which specializes in investments in the energy sector, to invest in CSA Energy Infrastructure Suisse with assets worth CHF 103.8 million and CSA Energy Infrastructure Suisse with assets worth CHF 60 million. Established three energy transition infrastructure investment vehicles. Adrian Waibel, chief investment officer and deputy chief executive officer of the scheme, said total assets were 8 million francs, and Energy Infrastructure Europe 2018 assets were 71.9 million francs.
Infrastructure recorded a return of 11.19% last year, the highest among the scheme’s asset classes.
Pktg added that it is implementing a strategy to increase investments in systems for climate-friendly energy production and in companies that take advantage of the opportunities presented by climate change.
Pension funds are reviewing their real estate strategies this year with sustainability and market conditions in mind. The company is investing CHF122 million in directly owned real estate through four large-scale construction projects, which it claims will help it move a step closer to decarbonizing its investment portfolio by 2030. .
The real estate investments directly held in Switzerland amounted to CHF 677 million at the end of June, representing 13.4% of the scheme’s total assets.
At the end of 2023, pktg recorded a funding rate of 104.6%, up from 102.6% in 2022, and achieved a net profit of 5.12% compared to -7.49% in 2023.
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