A sign hangs in the office of the Ontario Teachers' Pension PlanMatthew Sherwood/The Globe and Mail
Ontario Teachers' Pension Plan is expanding its London office as it shifts more of its international decision-making abroad.
The pension fund said Tuesday that it would grow its representation in Europe, taking out a 15 year lease on the second floor of 10 Portman Square, a building in Marylebone whose neighbours include the local offices of PIMCO, Boston Consulting Group and D.E. Shaw & Co. Within two years there could be about 30 people working in Teachers' office. The new space will be able to hold more investment professionals focused on a more diverse set of asset classes.
Teachers' is shifting toward a more integrated method of investing in Europe and beyond. Rather than the current organization of having employees in working on European deals and partnerships out of Teachers' home base in Toronto, the fund will have more employees in the same time zone responding to business developments as they arise.
"When you hit this critical mass of assets and relationships, it's much, much more efficient to have an integrated process so that you can support the investments you already have there," said Ron Mock, chief executive of Teachers'. "That critical mass was crossed a little while ago, so this was a very timely move for us."
From its $130-million deal for Wagon Wheel-maker Burton's Biscuit Co. last year, to buying the half of Bristol Airport it didn't already own in September, Teachers now has a wide variety of assets in the region to manage. Mr. Mock says having representation for more asset classes in the London office will put the Teachers in a the position to quickly react to investment opportunities. "You need local staff to be able to respond to stuff," he said.
Such a shift requires oversight by one leader. Teachers also announced Tuesday that it has promoted experienced investor Jo Taylor to lead the London office as managing director of Europe, Middle East and Africa (EMEA), a region where Teachers had about $21-billion in investments as of the end of 2013. The majority of these investments are in Europe.
This position lets Mr. Taylor oversee "the full cycle" of investment opportunities, from analysis to execution. He will also continue leading Teachers' Private Capital and private equity investments in the region. Mr. Taylor joined Teachers in 2012 to oversee the London office. He formerly worked at private equity investment group 3i Group Plc.
While Teachers' formally launched its London office in 2007, the fund has had a presence in London since 1998 when Teachers' Private Capital team began working in the region. Then the infrastructure group moved some employees to the office in 2002.
The formula used to build out the London office is at work in other parts of the world as well. "We've not opened an office in Latin America. We will. But we're reaching the critical mass point there as well. Particularly in Brazil and Chile and others," Mr. Mock said.
Mr. Mock also points to Hong Kong and China, where Teachers had upwards of $12-billion invested before opening an office in Hong Kong.
Editor's note: This story has been corrected to show the deal for Wagon Wheel-maker Burton's Biscuts was for $130-million, not $130-billion