2023 Performance

In 2023, the real estate portfolio generated a -2.81% return compared to our benchmark of 1.00%. As central banks around the world continued their fight against inflation, interest rates went up and real estate values went down.

Offices, where we had an overweight position of 20.01% (target 6.37%), were the least profitable type of property this year.

We held an equal weight to the benchmark in residential assets, which was the top performing property asset class for 2023.

Investment Approach

We work with top real estate managers who oversee our properties around the world. Our focus is on retail, office, industrial, and residential properties.

Our goal is to generate stable and growing income streams in our core portfolio of assets with long-term leases in place. We try to increase the value of these properties through upgrades and by making them more attractive for sale. We also add value by developing market-leading properties for long-term ownership.

Capital Allocation

We sold some of our properties. As a result, total real estate allocation decreased from the end of 2022 by $23 million.

We are shifting our focus from Canadian properties to those in other parts of the world. At the end of 2023, 18.15% of our investments were in global properties. We plan to increase this percentage moving forward.