Freschia Gonzales of Wealth Professional reports Quebec pension giant bets big on Brazil's power grid:

Two of Latin America's largest energy infrastructure investors are consolidating their Brazilian transmission assets into a single platform, betting on the country's grid modernization push. 

La Caisse de dépôt et placement du Québec and Colombia-based Grupo Energía Bogotá (GEB) have signed a final agreement to merge their respective Brazilian power transmission holdings into a jointly controlled, 50/50 venture under the name Verene Energia S.A. 

The combined entity will hold 26 electric transmission concession agreements, more than 9,000 km of transmission lines, and over 400 employees across 17 Brazilian states.  

A scale the partners say places Verene among Brazil's top five transmission operators. 

Verene will pursue growth through network optimization, infrastructure expansion, and potential acquisitions, aligned with Brazil's broader decarbonization objectives. 

Emmanuel Jaclot, executive vice-president and head of infrastructure and sustainability at La Caisse, said GEB brings "more than 130 years of operating heritage" to the venture. 

Jaclot said the partners plan to grow Verene's footprint in Brazil through acquisitions and continued support for the country's energy transition. 

GEB president Juan Ricardo Ortega said the deal marks "a significant milestone" in the company's long-term Brazil strategy, citing the combination of GEB's regional expertise with La Caisse's financial reach. 

Financial close is expected by Q4 2026, pending regulatory approvals.  

On Friday, La Caisse issued a press release stating it and Grupo Energía Bogotá will establish Brazil’s 5th largest power transmission platform:

• The partners will co-control the joint venture on a 50/50 basis under the Verene name

Global investment group La Caisse, and Grupo Energía Bogotá (“GEB”), a leading Latin American energy infrastructure group, today announced that they have entered into a final agreement to create a jointly controlled, 50/50 power transmission platform in Brazil, bringing together their respective transmission assets in the country under a single joint venture which will retain the name Verene Energia S.A. (“Verene”).

The combined platform will comprise 26 electric transmission concession agreements, more than 9,000 km of transmission lines, and over 400 employees, with operations spanning 17 Brazilian states. With this scale, Verene will rank among the top five power transmission players in Brazil.

Verene will continue to operate as the reference platform for the combined portfolio and will be positioned to pursue disciplined growth opportunities in Brazil’s transmission market, including the optimization and expansion of existing networks and potential acquisitions, in line with Brazil’s broader grid modernization and decarbonization objectives.

Juan Ricardo Ortega, President at GEB, said:
“Our partnership with La Caisse marks a significant milestone in our long-term strategy for Brazil. By combining our operational expertise and regional market knowledge with the financial strength and global perspective of our partner, we are creating a platform positioned to accelerate growth, expand transmission energy infrastructure, and support Brazil’s energy transition. We believe this alliance will generate sustainable value for our stakeholders and contribute to Brazil’s economic and energy development.”

Emmanuel Jaclot, Executive Vice-President and Head of Infrastructure and Sustainability at La Caisse, said:
“By bringing together highly complementary assets under one banner, the partnership establishes Verene as a scaled, business-driven platform with strong financial backing. GEB brings more than 130 years of operating heritage and ranks among Latin America's leading energy infrastructure groups, with deep expertise across the region's transmission sector. Together, we share a vision to strengthen Verene's footprint in Brazil through value-creating acquisitions and continued support for the country's energy transition.” 

Financial close is expected by Q4 2026, subject to customary closing conditions and relevant consents and approval.

La Caisse was advised by BTG Pactual as financial advisor and Pinheiro Neto Advogados as legal advisor. GEB was advised by Citibank as financial advisor and Mayer Brown as legal advisor.

ABOUT GRUPO ENERGÍA BOGOTÁ

For more than 130 years, Grupo Energía Bogotá has contributed to the development of Latin America’s energy sector through the operation, development and investment in electricity and natural gas infrastructure. Headquartered in Bogotá, the company operates across Colombia, Peru, Brazil and Guatemala, with a diversified portfolio of electricity generation, transmission and distribution and gas transportation and distribution investments.

As a leading Latin American energy group, Grupo Energía Bogotá combines strong corporate governance, operational excellence and a long-term sustainability strategy to improve lives through competitive and reliable energy services. The company is listed on the Colombian Stock Exchange and continues to play a key role in the region’s energy transition and infrastructure growth. Learn more at Grupo Energía Bogotá and LinkedIn.

ABOUT LA CAISSE

For more than 60 years, La Caisse has invested with a dual mandate: generate optimal long-term returns for its 48 depositors, who represent over six million Quebecers, while contributing to Québec’s economic development.

As a global investment group, La Caisse is active in major financial markets, private equity, infrastructure, real estate and private credit. As at December 31, 2025, its net assets totalled CAD 517 billion. Learn more atLaCaisse.com, LinkedIn or Instagram. 

This is another great infrastructure deal where La Caisse is partnering up with Grupo Energía Bogotá (GEB) to invest in Brazil's power transmission lines. 

The new platform, a jointly controlled, 50/50 venture under the name Verene Energia S.A., will hold 26 electric transmission concession agreements, more than 9,000 km of transmission lines, and over 400 employees across 17 Brazilian states.  

The theme remains the same as other countries. Brazil is growing fast and wants to decarbonize its economy. That means more electric vehicles and higher demand for electricity. Add to this the needs of the AI economy, which means more data centres, and electricity demand will take off in a huge way there.

Are there risks investing in Brazil? Any time you invest in Latin American infrastructure or real estate, you're taking political and currency risk but La Caisse and other large Canadian pension funds know the country very well, and the top bank there (BTG Pactual) advised them on the deal, so I'm very confident the terms of the deal reflect all potential risks.

Again, Juan Ricardo Ortega, President at GEB, summed it up well in the press release when he states this:

“Our partnership with La Caisse marks a significant milestone in our long-term strategy for Brazil. By combining our operational expertise and regional market knowledge with the financial strength and global perspective of our partner, we are creating a platform positioned to accelerate growth, expand transmission energy infrastructure, and support Brazil’s energy transition."

In other related news, earlier today, a press release was issued where BIG Fiber secured $250 million in financing led by Stonepeak Credit and La Caisse to accelerate digital infrastructure expansion:

• Investment Fuels Expansion, Boosting Total Assets to over 800 Route Miles

BIG Fiber, a leading provider of high-capacity dark fiber infrastructure, announced the closing of a $250 million debt facility with an additional $100 million accordion feature. The financing, led by Stonepeak Credit and La Caisse (formerly CDPQ), provides BIG Fiber with significant capital to accelerate the expansion of its core markets and reinforce its position as the premier provider of mission-critical digital infrastructure in the U.S.

The new credit facility follows BIG Fiber’s 2024 milestone, the first-ever green loan in the dark fiber sector, and marks a significant scaling of the company’s financial capacity. Backed by sponsors Columbia Capital and SDC Capital Partners, the expansion of BIG Fiber’s debt facility and the infusion of new capital ensure the company remains well-positioned to meet the escalating infrastructure demands of the AI era.

Proceeds of the facility will be used to refinance existing debt, provide new capital and facilitate the necessary headroom for major network expansions already underway. This includes a significant multi-market buildout in Greater Atlanta, adding over 205 route miles and 165,000 fiber miles to BIG Fiber’s existing market-leading footprint.

“Our partnership with Stonepeak Credit and La Caisse marks a pivotal moment in our mission to empower our customers with highly-scalable and purpose-built dark fiber solutions," said Bruce Garrison, CEO of BIG Fiber. "This financing ensures we have the scale to stay ahead of the escalating demand for modernized infrastructure enabling the AI ecosystem and the necessary digital highways for decades to come.” 

"BIG Fiber’s infrastructure delivers critical bandwidth to meet the insatiable demand for both data and compute capacity across its key markets," said Arun Varanasi, Managing Director at Stonepeak Credit. "We are proud to partner with Columbia Capital, SDC Capital Partners, and La Caisse to support the Company's next leg of growth as it positions itself as one of the preeminent dark fiber operators in the country." 

“BIG Fiber is well positioned to meet the growing connectivity needs of enterprises and data centers seeking new, high quality infrastructure options,” said Jérôme Marquis, Managing Director and Head of Private Credit at La Caisse. “Its resilient business model, underpinned by long term contracts and strong structural demand, positions the company well for growth. Together with Stonepeak Credit, we’re providing a tailored financing solution that supports the continued build out of essential digital infrastructure.”

The latest expansion will bring BIG Fiber’s Atlanta and San Francisco Bay Area network capacity to 850 route miles and over 3 million fiber miles. Projects are currently under construction or contract, with phased Ready for Service (RFS) dates expected in early 2027.

About BIG Fiber

BIG Fiber is a metro dark fiber provider that offers high capacity, strategically placed, dark fiber networks to mission critical data centers, Hyperscalers and enterprises throughout the San Francisco Bay Area, Greater Portland and Greater Atlanta areas. BIG Fiber’s 100% underground network meets critical data needs for enterprises and data centers that require new, quality infrastructure options. BIG Fiber’s San Francisco Bay Area network offers more than 320 route miles and 65 data centers. The Greater Portland network has more than 20 route miles and 15 data centers, and the Greater Atlanta network has more than 550 route miles and 30 data centers. BIG Fiber was founded in 2019 and is headquartered in Sunnyvale, California. Visit www.bigfiber.com to learn more.

About Stonepeak Credit

Stonepeak Credit is the credit investing arm of Stonepeak, a leading alternative investment firm specializing in infrastructure and real assets with approximately $88 billion of assets under management. Stonepeak Credit targets credit investments across the transportation and logistics, energy and energy transition, digital infrastructure, and social infrastructure sectors that provide essential services with downside protection, high barriers to entry and visible, recurring revenue generation. It seeks to provide capital solutions that are flexible across the capital structure while generating cash yield through majority senior secured credit investments.

Stonepeak is headquartered in New York with offices in Houston, Washington, D.C., London, Hong Kong, Seoul, Singapore, Sydney, Tokyo, Abu Dhabi, and Riyadh. For more information, please visit www.stonepeak.com. 

This is another example of a private credit deal where La Caisse is partnering up with Stonepeak Credit to provide credit to BOG Fiber to grow its operations to meet the growing demands of bandwidth during the AI build-out phase.

Bruce Garrison, CEO of BIG Fiber summed it up: "This financing ensures we have the scale to stay ahead of the escalating demand for modernized infrastructure enabling the AI ecosystem and the necessary digital highways for decades to come.”  

What else? La Caisse is on record that it wants to double its allocation to private debt in the next 5 years and these are the type of large transactions that will enable it to get to its target.  

Jérôme Marquis, Managing Director and Head of Private Credit at La Caisse and his team are on pace to meet this target.

Below, understanding Brazil's Transmission Model: A Presentation by Luiz Barroso: CEO of PSR Energy Consulting and Analytics and former Director of Brazilian Energy Planning Agency (two years ago). 

In this International Online Conference for the African School of Regulation (ASR), Luiz Barroso explores the Brazilian electricity transmission business model. 

Excellent presentation, take the time to listen to his insights. 

Sean Conlon, Sarah Min and Lisa Kailai Han of CNBC report the Dow loses more than 500 points on Friday as tech slumps and yields spike:

Stocks fell on Friday, bogged down by losses in technology stocks and a rise in U.S. Treasury yields, after a summit between President Donald Trump and Chinese President Xi Jinping ended and left traders worried about no major policy breakthroughs.

The S&P 500 shed 1.24% to end at 7,408.50, while the Nasdaq Composite slipped 1.54% to 26,225.14. The Dow Jones Industrial Average was down 537.29 points, or 1.07%.

Investors took profits in tech after the group saw sharp gains recently. Notably, Intel retreated 6%, while Advanced Micro Devices and Micron Technology lost 5.7% and 6.6%, respectively. Nvidia dropped 4.4%, while Cerebras Systems — which surged 68% Thursday after it began trading on the Nasdaq — shed 10%.

“The group has witnessed an extremely unsustainable move in recent weeks and remains vulnerable to profit taking regardless of the headlines,” wrote Adam Crisafulli of Vital Knowledge.

Microsoft was an exception, however. The stock was 3% higher after Bill Ackman said Friday that Pershing Square has built a position in the name.

Treasury yields jumped, pressuring stocks, with the 30-year rate topping 5.1%. A series of reports this week showed inflation was revving back up as oil prices remain elevated from the Middle East conflict. Higher rates could hit the high growth stocks the hardest.

Oil prices traded higher Friday. U.S. West Texas Intermediate futures rose 4.2% to settle at $105.42 per barrel, while international Brent futures settled up 3.35% to $109.26. That’s after Trump told Fox News that he is “not going to be much more patient” with Iran, adding that “they should make a deal.”

Investors were disappointed following the conclusion of the summit between Trump and Xi, as no major deals have been announced. The two agreed that the Strait of Hormuz must remain open, according to a U.S. readout that was shared by a White House official. But “the few headlines that did come out of the summit (like the Boeing orders) were underwhelming,” Crisafulli wrote.

Boeing shares extended their losses Friday, moving lower by 3% following a nearly 5% drop in the previous session, as investors were let down by Trump saying that China has agreed to buy 200 Boeing jets — just 50 more than the company had previously anticipated.

Thursday marked a winning session for the indexes. The Dow reclaimed the 50,000 level, and the S&P 500 closed above 7,500 for the first time.

Stocks have been on a record-breaking tear on a renewed fervor around artificial intelligence. While Argent Capital Management’s Jed Ellerbroek believes sentiment among investors “remains very optimistic overall,” a peek under the hood is showing that the broader market is lagging the largest tech companies, a divergence that is increasingly worrying some investors as it suggests a fragile rally.

“It doesn’t feel right to say that tech is just going to lead forever,” the portfolio manager said, noting that the “HALO” trade earlier this year saw tech stocks “shunned” in support of those in sectors such as consumer staples and materials. “One thing kind of popping up and driving the market is inherently more risky than if there were several things.” 

Amalya Dubrovsky , Rian Howlett , Karen Friar and Grace O'Donnell of Yahoo Finance also report 

US stocks sank on Friday, retreating from record highs as rising bond yields and inflation worries preyed on markets and investors were gauging the success of the Trump-Xi summit in China.

The tech-heavy Nasdaq Composite (^IXIC) slid 1.5%, dragged lower by a 4% decline in Nvidia (NVDA), which reports earnings next week, and pressure on other chip stocks.

The S&P 500 (^GSPC) fell 1.2% after surging to all-time closing highs on Thursday, while the Dow Jones Industrial Average (^DJI) lost 1%, or 530 points, and dropped back below 50,000 as stocks came under pressure.

Stocks pulled back as a global bond rout weighed on sentiment to end the week, with the benchmark 10-year Treasury yield (^TNX) climbing to 4.59%, and the 30-year yield (^TYX) reaching 5.13%.

Investors also assessed the geopolitical backdrop as President Trump concluded his visit with Chinese counterpart Xi Jinping in Beijing. The two-day summit struck a business-friendly tone, involving 16 top US executives and delivering new deals for the likes of Boeing (BA) and Nvidia (NVDA).

However, the diplomatic issues of Taiwan and Iran continued to lurk in the background. US officials hoped that China could help end the war with Iran by using its influence with its major oil supplier. Trump said China and the US “feel very similar about Iran,” but Xi struck a more measured tone.

The lack of progress toward peace has stoked concern about the conflict’s price pressures, shown in this week’s US inflation readings. Oil futures rose over 2%, with Brent (BZ=F) trading around $109 a barrel. 

So the Xi-Trump summit happened and traders used it to sell the news.

Long bond rates keep inching higher and all of a sudden Wall Street is paying attention and decided to sell red-hot semis and other tech shares on Friday to buy energy and commodity stocks.

Still, for the week, while Energy outperformed all other sectors, Information Technology did manage to eke out a 1% gain (data source here):

As far as large cap shares, here were this week's top performers:

 And the worst-performing large caps (full list here):

 

So what does inflation pressure mean for the Fed and stocks going forward? 

Well, BCA's Chief EM/ China Strategist Arthur Budagyan posted this on LinkedIn earlier today:

I tend to agree, a 10-year above 4.5% will pose significant challenges for stocks but if earnings keep surprising to the upside, you never know, maybe there's more juice left to power stocks higher. 

Next week, King Kong (Nvidia) reports, so let's see the reaction afterwards. 

Below, CNBC’s “Halftime Report” Investment Committee debate whether it’s safe to buy the tech pullback.

Christopher Neely of The Real Deal reports the German pension fund that lost $1B on a risky US real estate bet doesn’t want to talk about it:

The managers of Germany’s largest public pension fund want to wipe their hands clean of their increasingly contentious exit from San Francisco’s Transamerica Pyramid.  

Earlier this week, Bayerische Versorgungskammer (BVK) — a state-run institution managing the pensions of 2.8 million public employees in Bavaria — rejected accusations raised in a recent lawsuit that it broke investment rules and stiffed one of its partners out of more than $30 million after selling the Transamerica Pyramid in March. 

As part of that lawsuit filed last month, Deutsche Finance America claimed BVK “went to concerted, conspicuous lengths” to skip paying the firm its early termination fee of $31.3 million. The firm claimed that BVK paid its other partner — New York developer and face of the Transamerica Pyramid revival, Michael Shvo — $79 million despite the partners having similar termination fee structures. Shvo’s payday, Deutsche Finance America said, raised “grave questions” about the deal. 

Representatives of BVK called the allegations “unfounded,” and said they “vigorously reject” them, according to a statement released Tuesday to trade publication, Investment & Pensions Europe. 

Partnering with Shvo and Deutsche Finance America, BVK funneled nearly $2 billion into seven U.S. properties, including the Transamerica Pyramid and the Raleigh Hotel in Miami, according to Deutsche Finance’s court filing last week. Although no precise final number has been released, BVK has estimated that losses on those investments could exceed $1 billion. 

Deflecting accountability

BVK, which is supervised by Bavaria’s interior ministry, has continuously tried to evade direct responsibility for the series of failed U.S. real estate bets it made with pensioners’ money. It leans on the fact that it used what’s called a “fund-of-funds” structure to invest in the real estate portfolio, where BVK put money into third-party, Luxembourg-based funds that then made the investments.

In March, BVK’s CEO, Axel Uttenreuther, told a German news outlet that Deutsche Finance and Shvo had identified the properties in advance of BVK’s investment. Deutsche Finance has explicitly denied this claim. 

Last summer, BVK fired its long-time head of real estate investment management Rainer Komenda after more than 20 years at the helm. Months later, Norman Fackelmann, who served just under Komenda, quit the institution, according to Investments & Pensions Europe. An internal investigation by BVK found Komenda had too close a relationship with its business partners, which included stays at luxury hotels and meals at high-end restaurants. Bloomberg reported that a younger relative of Komenda held internships at Deutsche Finance’s London and Denver outlets, as well as Shvo’s firm. 

Komenda sued BVK over his dismissal. In March, a Bavarian court sided with Komenda. According to Investments & Pensions Europe, BVK planned to appeal and had fired Komenda all over again based on “fresh findings from a recent internal investigation.” 

The pension fund sought to further distance itself from the Transamerica Pyramid deal with its comments on Tuesday. BVK told Investment & Pensions Europe that it learned of Deutsche Finance’s latest court filing through a “third party” and characterized the dispute as between Deutsche Finance and an externally managed fund of funds. 

“BVK is neither a party to the petition nor to the arbitration proceedings,” a representative told the London-based trade publication. 

Deutsche Finance America’s lawsuit does not explicitly name BVK as a defendant, but rather two Luxembourg-based investment funds, Elektra 2 and 711 Investments SCS. However, it says BVK acted through the two companies in refusing to pay DFA its fee for early termination of its asset management services on the Transamerica Pyramid.

Losing streak 

In March, BVK sold its piece of the San Francisco skyline and the two adjacent properties for $692 million to Cyprus-based investment firm Yoda PLC. The sale marked a more than $200 million loss on the investment, part of the larger, billion-dollar losing streak for BVK’s U.S. portfolio. 

At the time of the sale, Yoda PLC reported that, amid the losses for German investors, Shvo would receive a separate $34 million exit package that covered his broker’s pay for representing both sides in the transaction, an early termination fee and the cost of buying out his right of first offer agreement on the property. 

Yet, as the estimates of losses grew for German investors, Shvo’s riches seemed to increase. Deutsche Finance America’s court filing last week claimed Shvo actually made $79 million on the deal thanks to an additional $45 million he earned in December after BVK allegedly terminated his contract as asset manager. That timeline contradicts Shvo’s claim that he remained asset manager until the property’s sale in March.

Spokespeople for Shvo have denied he was terminated as asset manager in December and said he stayed on in the role until the building’s sale in March. On several occasions, the spokespeople declined to comment on whether Shvo was paid an additional $45 million in fees.

Deutsche Finance is arguing that it had a fee-protection agreement identical to Shvo’s but received nothing after the property was sold.

The dispute between Deutsche Finance and BVK’s funds remains in arbitration. Meanwhile, lawyers in Bavaria whose pensions are managed by BVK have been gearing up for months for a possible class action-style lawsuit against the state-run pension fund and the state of Bavaria. 

Editors Note: A previous version of this story misattributed a claim to Shvo’s spokespeople. The spokespeople declined to comment on whether BVK paid Shvo an additional $45 million in fees. They did not deny it, as previously reported. 

This isn't a new story. Back in February, Julian West of AInvest wrote BVK's US real estate bet was a symptom of Germany's housing crisis, noting this:

The financial impact of Bayerische Versorgungskammer's US real estate missteps is contained, but the fallout is about trust. The group faces a potential additional loss risk of up to €690m from a small number of higher-risk development and refurbishment projects. This represents roughly 0.6 per cent of BVK's total €117bn portfolio, a level the group deems manageable. Crucially, BVK maintains that pension commitments to members are not affected, arguing that any losses are offset by gains in other asset classes. In 2024, the group delivered a capital-weighted net return of around 3.4%, meeting its central investment target.

Yet this is not merely a story of a small bet gone wrong. The core question is whether this is a manageable financial event or a symptom of deeper institutional failure. The scale of the potential loss is dwarfed by the group's total assets, but the governance and transparency failures are not. Members of BVK, which manages funds for 2.7 million people, are preparing legal action to obtain information and potentially compensation. German law firms have set up an interest group, claiming BVK has refused to provide information despite repeated requests, necessitating a lawsuit to force disclosure.

The thesis here is clear. The financial impact is contained within BVK's diversified strategy. The real damage is to fiduciary trust. The group's own measures-appointing an external manager, tightening partner standards, and strengthening compliance-admit to a breakdown in oversight. When a pension fund managing hundreds of billions cannot provide basic information to its members, even under confidentiality agreements, it raises fundamental questions about accountability. The bottom line is that while the numbers may not threaten pensions, the opacity and the need for legal compulsion to reveal them do threaten the very foundation of the system.

The Governance and Transparency Crisis

The core failure here is not financial, but fiduciary. While BVK's total portfolio is large enough to absorb the potential losses, its refusal to communicate with its members represents a fundamental breach of trust. The breakdown is now formalized through legal action. German law firms Mattil and Greger & Collegen have set up an interest group to seek disclosure, stating they have asked BVK "several times" for information but received no response. This has forced them to conclude that a lawsuit is necessary to compel transparency, with the case ready to be filed in Munich. 

This legal push starkly contrasts with BVK's public messaging. The group's CEO has repeatedly emphasized that transparent, trust-based dialogue remains a core element of its governance approach. Yet the fund's actions in withholding information from members-its ultimate beneficiaries-undermine that very claim. The excuse offered, citing pending legal proceedings in the US and existing confidentiality obligations, does not hold up under scrutiny. The law firms represent members of the very pension funds BVK manages, and the information sought is about the fund's own investments and performance. The conflict is clear: a fiduciary refusing to communicate with its members.

The planned legal action in Munich seeks both disclosure and potential compensation for member losses. This is the ultimate consequence of a governance model that prioritizes legalistic defensiveness over open communication. When a pension fund managing hundreds of billions cannot provide basic information to its members, even through a legal representative, it reveals a system in crisis. The bottom line is that while the financial impact may be contained, the institutional failure-the refusal to engage-is what truly threatens the integrity of the pension system.

What a complete mess. I read this story and others related to it earlier today and I'm bringing it up on my blog for one simple reason: if you don't have the right governance, your pension fund is a swamp.

And proper communication figures into the right governance. In fact, it's governance 101.

Those lawyers in Bavaria whose pensions are managed by BVK need to go after BVK hard and make sure they get accountability and implement changes to the governance there to make sure this never happens again.

Let me be honest, this story reminds me of the Wild West days of real estate, where corruption and bribes were rampant. 

Rainer Komenda is taking the fall for this mess, but the truth is BVK’s CEO, Axel Uttenreuther, should have also been dismissed from the organization.

In total, over $1 billion was lost on shady real estate deals. Blaming the fund of funds you hired is farcical; you still have the responsibility to oversee its investments.

I personally hate funds of funds because they add an extra layer of fees but I understand that sometimes you need expertise if you don't have it in-house.

BVK would have been better off approaching an Oxford Properties or QuadReal here in Canada than investing in some second-tier fund of funds.

It also sounds to me like Deutsche Finance America has a legitimate lawsuit and should get the same terms Michael Shvo received (Shvo and BVK’s CEO Axel Uttenreuther are feautured at the top of this post).

Anyway, what a mess. This is Germany’s largest public pension fund and this isn't a story you want associated with your organization.

No wonder members are furious and looking into class-action lawsuits (they will not recover losses but can demand changes to the governance structure).

Again, my advice is to get certified fraud examiners, audit the real estate department thoroughly and figure out who was accountable and what changes can be made in the governance structure to make sure this never happens again.

I would also take a closer look at Michael Shvo's role in all these real estate dealings.

Below, an older (December, 2024) clip where developer Michael Shvo discusses his $1B San Francisco investment in Transamerica Pyramid (see backstory here) and why he believes the redesigned iconic building is the Rolls Royce of office.

Lauren Bailey of Markets Group takes a look inside the Halifax Port ILA/HEA Pension Plan’s ‘micro Maple 8’ strategy:

Markets Group Lifetime Achievement Award recipient Blair Richards reveals how a small Canadian pension plan quietly outperformed expectations for decades — and why the traditional playbook was never going to be enough.

In this wide-ranging conversation, the longtime CIO of the Halifax Port ILA/HEA Pension Plan shares how he transformed a conservative 70% fixed-income portfolio into a forward-thinking “mini Maple Model,” embracing private equity, private credit, and alternative assets long before it became mainstream.

Richards explains how disciplined long-term investing, diversification across vintages, and a relentless focus on member outcomes helped the plan achieve a remarkable 134% solvency ratio and inflation-beating pension increases, while many other sponsors were abandoning defined-benefit pension plans altogether.

He also opens up about one of the defining decisions of his career: securing a landmark buyout with Sun Life that guarantees retirees a 4% annual cost-of-living adjustment for life. Along the way, he discusses the risks of today’s geopolitical climate, why he’s cautious on artificial-intelligence investing, and the leadership philosophy that shaped his success: surround yourself with experts and trust them deeply.

This episode is a masterclass in pension investing, fiduciary leadership, and adapting institutional strategies for the real world — whether you manage billions or just want to understand how the smartest long-term investors think. 

A week ago, Lauren Bailey also reported Halifax Port ILA/HEA pension completes PRT deal with Sun Life, locks in 4% COLA:

The Halifax Port International Longshoremen’s Association/Halifax Employers Association Pension Plan has entered into a pension risk transfer deal for its defined-benefit pension plan with the Sun Life Assurance Co. of Canada that locks in guaranteed annual increases.

The move comes as the plan reported a 147% solvency ratio in 2025. The Halifax Port ILA/HEA, which dates back to the 1950s and serves roughly 600 active members and 300 retirees, completed the buyout transaction valued at approximately C$57M.

For years, the Halifax ILA/HEA has maintained a surplus, enabling it to provide ad-hoc pension increases that ultimately tripled pension payments over time, said Blair Richards, the plan’s chief investment officer.

“That was the reason we held onto the plan, continued to run it in the first place,” he said.  

During a panel discussion hosted by Sun Life, Richards noted that in 2024, the plan’s actuary determined the policy had exhausted its available room, preventing further increases despite the plan’s strong surplus position. The realization prompted trustees to explore 12 strategic alternatives before ultimately pursuing a buy-in and buyout structure.

“Once it was clear that we could not do any better on an ad-hoc basis with respect to pensioner raises than we could guarantee with a buyout, the decision was obvious,” Richards told Markets Group. “We locked in a 4% annual cost-of-living adjustment for our retirees.”

The transaction also required solving for illiquid real estate assets held within the pension portfolio. While most of the plan’s assets were invested in liquid funds, a portion earmarked for the annuity premium was tied to a real estate vehicle with limited redemption flexibility.

Mercer, which advised the plan on the pension risk transfer, worked with Sun Life to develop a deferred premium structure that allowed the illiquid assets to remain in place while transferring pension risk immediately.

“We agreed to divide the premium into two components,” said Emile Alarie, principal and PRT specialist at Mercer, during the panel discussion. “A cash premium that would be paid at the onset like a typical premium transfer, and a deferred premium that would cover the illiquid asset portion.”

The deferred portion was structured similarly to a loan, allowing repayment over time as the underlying real estate fund generated liquidity. The arrangement enabled the plan to lock in pricing and complete the transaction without waiting for the assets to fully liquidate.

Alarie said the structure could provide a template for other Canadian pension plans holding illiquid assets that are exploring de-risking efforts.

“In the end, what we wanted to do was find a way to get this deferred premium completed, and ultimately we got to the goal with this innovative feature,” he said.

The plan also placed significant emphasis on governance, data validation and communication throughout the process. Richards said trustees were repeatedly updated to ensure they fully understood the implications of the transaction before making a final decision.

Improving funded ratios and elevated interest rates have prompted more Canadian pension plans to evaluate pension risk transfer strategies and annuity purchases. Plan sponsors are increasingly exploring customized structures to address illiquid holdings, surplus management and inflation protection within defined-benefit plans.

A TELUS Health report citing Financial Services Regulatory Authority of Ontario data showed a median solvency ratio of 124% for Ontario plans in the third quarter of 2025, with stability maintained through the year. With many Canadian plan sponsors sitting on meaningful surplus, the focus, said the report, will likely be on both protecting and strategically utilizing these positions to derive value.

It noted that surplus can quickly evaporate with the changing environment, making it critical for plan sponsors to review their funding and investment strategies to protect their gains.

After decades helping oversee the Halifax Port ILA/HEA pension plan, Richards is now preparing to retire. He leaves the role with a strong sense of satisfaction, having realized outsized growth and, now, the plan’s de-risking transaction.

“I’m not sure it could be any more satisfying,” Richards said. “The results speak for themselves.”

Still, he acknowledged that he’s leaving as economic uncertainty remains a constant feature of the investment landscape.

“There are always challenges,” he said. “Geopolitical risks can’t be ignored at the moment, but the plan is in very strong shape and in very capable hands, so I remain optimistic.” 

I met Blair Richards years ago at a conference and hit it off with him because he's a smart, no-nonsense type of guy who gets it.

I like this interview a lot, which is why I embedded below.

Let me provide some more background. 

Two years ago, Bryan McGovern of Benefits Canada reported on Halifax Port ILA/HEA assessing past, future of DB pension plans:

While Blair Richards understands why the industry is moving away from defined benefit pension plans, he worries about what may be lost in the process.

When Richards — the chief investment officer at the Halifax Port ILA/HEA pension plan — joined the institutional investor 40 years ago, DB plans were an attractive hiring and retention tool for private sector employers. Now, he says the risk associated with these plans has led to a widespread exit strategy.

The organization opted to keep its DB plan, which has been closed since 1984. “I have unfortunately lived through what I guess was the high point of DB plans and what will eventually be a complete loss. . . . I had hoped . . . [they’d] come back around. [They have] slightly, but [not] like . . . before.”

The Halifax Port ILA/HEA continues to manage the DB plan’s investments, but without further financial support from its employers, the investment team knew it had to take a conservative approach.

Due to its size, the breakeven point is low compared to most, which motivated the team to focus on alternative investments early on, says Richards, noting the plan has also reduced its allocations to fixed income over time.

“Now as the rates have come back up, the reason we got away from that high weighting is that if your breakeven is five per cent and your expected return around a 10-year bond is two per cent, you can’t sit on that position. You’re forced away from that very bond that has served you so well for decades.”

The development of advanced life deferred annuities and variable payment life annuities has helped the plan provide lifetime payments to members. Indeed, for more than 30 years, the plan has been providing raises to members, says Richards. “Not only did we increase pensions, we . . . increased those pensions by 155 per cent . . . above inflation over the period, so we’re sitting on a very successful plan here.”

While increasing pension benefits is a priority for the Halifax Port ILA/HEA, an internal policy on excess interest has prevented an increase over the last two years, during which the plan’s surplus grew to 134 per cent on a solvency basis as of the end of September 2023.

Read: Blair Richards moves to CIO of Halifax Port ILA/HEA pension plan

He says the plan has shifted away from this policy and increases are expected to begin again this year.

Employees enrolled in the Halifax Port ILA/HEA’s defined contribution plan can also purchase a pension from the DB plan. “At the point of retirement, they can take part of their balance, put it in the DB [plan] and create a floor between that and their government benefits — they can roll a portion into a registered retirement income fund or a life income fund to have the flexibility that a lot of people want.”

He credits much of the success of the DB plan with a long-term strategy, rigorous discipline and always asking questions from the perspective of members. “What we did was take that notion of fiduciary to heart. We wanted the best for the retirees in particular, but [for] pension members in general and we’ve proven that it is possible.” 

As you can read, the Halifax Port ILA/HEAisn't that "mini", it manages billions and Blair did a great job as CIO there, taking intelligent risks and diversifying the asset allocation to make the plan more resilient.

He's preparing for retirement, and in my opinion, he should write a book about his experience managing this plan.

Anyway, take the time to listen to Blair's interview below where he shares great insights with Lauren Bailey. Great guy in every respect, he deserves a nice retirement.

Matt Toledo of Chief Investment Officer reports Ontario Teachers’ Pension Appoints Intelligence Strategy Head:

The board of the Ontario Teachers’ Pension Plan announced last week the appointment of Feifei Wu to the newly established role of senior managing director of investment technology and applied intelligence.

Wu will lead the pension fund’s artificial intelligence strategy to strengthen governance and accelerate the adoption of the technology while partnering with investment leaders to ensure AI enables key business outcomes, according to the OTPP’s announcement. Wu will report to OTPP Chief Technology Officer Terry Hickey.

“I am pleased to welcome Feifei to Ontario Teachers’ in this important role at a pivotal time in our technology journey,” Hickey said in a statement. “She brings a strong combination of technical expertise and proven leadership across global financial institutions. Her experience building high-performing technology teams and her forward-looking approach to applied intelligence will help accelerate innovation, deepen investment insights, and deliver long-term value for our members.”

Wu joins from Macquarie Asset Management, where she was global head of engineering. Her previous roles include divisional chief information officer at Edward Jones and global chief information officer at Brown Brothers Harriman. She also served as an adjunct professor at New York University.

Wu earned a master of science degree and a Ph.D. in computer science with a focus on artificial intelligence from Rutgers University; a master of engineering degree in computer engineering from Zhejiang University in China; and a bachelor of engineering degree in computer engineering from Northeastern University, also in China.

OTPP manages C$279.4 billion ($204.29) billion in assets for 346,000 beneficiaries who are working and retired educators from the province of Ontario.

Last week, Ontario Teachers’ announced the appointment of Feifei Wu as Senior Managing Director, Investment Technology & Applied Intelligence:

TORONTO, May 4th, 2026 – Ontario Teachers’ Pension Plan Board (“Ontario Teachers’”) today announced the appointment of Feifei Wu as Senior Managing Director, Investment Technology & Applied Intelligence, effective immediately.  In this newly established role, Ms. Wu will partner closely with investment leaders to ensure technology enables key business outcomes, while leading Ontario Teachers’ AI strategy to strengthen governance, accelerate adoption, and unlock new opportunities. She will report to Chief Technology Officer Terry Hickey.

Ms. Wu has over 25 years of global experience at leading investment and wealth management firms, with deep expertise in technology, artificial intelligence, machine learning, and cloud transformation.

“I am pleased to welcome Feifei to Ontario Teachers’ in this important role at a pivotal time in our technology journey,” said Mr. Hickey. “She brings a strong combination of technical expertise and proven leadership across global financial institutions. Her experience building high-performing technology teams and her forward-looking approach to applied intelligence will help accelerate innovation, deepen investment insights, and deliver long-term value for our members.”

Ms. Wu joins Ontario Teachers’ from Macquarie Group in New York, where she most recently served as Managing Director, Global Head of Engineering of Macquarie Asset Management. Previously, she held senior leadership roles including General Partner, Digital & Technology at Edward Jones, Global Chief Information Officer at Brown Brothers Harriman, and Managing Director at RBC Capital Markets and BNY.

She has an MS and PhD in Computer Science (with a focus on artificial intelligence and machine learning) from Rutgers University, in addition to an ME in Computer Engineering from Zhejiang University and a BE in Computer Engineering from Northeastern University in China.

About Ontario Teachers’

Ontario Teachers' Pension Plan Board (Ontario Teachers') is a global investor with net assets of $279.4 billion as of December 31, 2025. Ontario Teachers’ is a fully funded defined benefit pension plan, and it invests in a broad array of asset classes to deliver retirement security for 346,000 working members and pensioners. For more information, visit otpp.com and follow us on LinkedIn.

 So what is this all about and why is it a big deal?

Two reasons. If OTPP and other large pension funds want to better understand the risks and opportunities of AI, they need experts who can help them better understand the AI landscape to figure this out.

The second reason, and it's equally important, OTPP wants to improve its total portfolio approach and AI will be help them standardize data, improve decision-making and be better prepared to pounce on market opportunities across the spectrum.

In short, Ms. Wu will be working with investment heads to understand their approach and needs and see how she can leverage AI at an organizational level to produce better outcomes over the long run. 

For OTPP to go ahead and attract Ms. Wu to their organization, it means they are getting serious about AI on a much deeper level.

In fact, on LinkedIn yesterday, PSP Investments' former CIO  and founder of Brave Foresight, Eduard van Gelderen, posted this:

Matt Toledo ( https://www.ai-cio.com/ ) reported: 'Ontario Teachers’ Pension Appoints Intelligence Strategy Head. Feifei Wu will serve in the newly established role of senior managing director for investment technology and applied intelligence.

When I interviewed the C-suite of the larger Canadian pension plans 18 months ago as part of my PhD research, it was clear that an 'AI Northstar' was not in place. Yes, experiments to come to productivity gains were initiated, but there was no clear AI vision. I am delighted that since then some of the funds have taken serious steps to figure out what a system solution (in contrast to a point solution) could look like. Congratulations to Terry Hickey and OTPP's C-suite for taking the lead. 

Indeed, congratulations to Terry Hickey, OTPP's CTO, for taking the lead here.  

There is actually a lot of work ahead; people mistakenly think that because they use AI in their daily activities, it's easy to implement it properly in a pension fund.

Like all other quantitative initiatives, I can tell you that if you do it properly, it will add value but if you don't, it's garbage in, garbage out.

Below, Feifei Wu, former Managing Director & Technology Head at Macquarie Group, shares how modern enterprises are building end-to-end AI architecture to support business-wide use cases (March, 2026).

From trading and research to operations and fund management, the foundation starts with strong data and memory layers enabling not just storage, but reasoning and inference. On top of that sits an orchestration layer, where agents, workflows, and AI applications are built and deployed.

With advancements in cloud platforms, vector search, and agent frameworks, what once took over a year to build can now be done in days or weeks. Integration, APIs, and MLOps capabilities ensure these systems are scalable, monitored, and production-ready.

Key takeaway: Modern AI architecture is about connecting data, models, and workflows, enabling faster, scalable, and enterprise-wide impact.

Smart lady, she obviously knows what she's talking about and will be an invaluable resource at OTPP.