Assets of global public pension funds and sovereign wealth funds (SWFs) breached the US$30 trillion mark for the first time in 2021 on the back of returns from investments in public and private equities, real estate and infrastructure, according to an annual report published by London-based research firm Global SWF.
Around two-thirds of the assets were held by public pension funds and one-third by SWFs.
Total assets of these state-owned investors rose 8.14% to $31.9 trillion from $29.5 trillion in 2020, Global SWF says in the report published recently.
Assets of public pension funds exceeded the $20 trillion level for the first time, rising 9.18% to $21.4 trillion, and those of SWFs topped $10 trillion, also a first, growing 6.06% to $10.5 trillion.
Their returns from investments in public equities rose 19.3%, up from 13.1% in 2020. Real estate returns rebounded from a 5.2% decline to surge 42.5% last year, and infrastructure bounced back from an 8.7% fall to grow 8.4%. Private equity returns saw a sharp improvement from 0.6% in 2020 to 37.8% in 2021.
The report says SWFs and public pension funds also deployed more capital in 2021 than in any of the previous six years, both in terms of number of deals and deal value, which was over $219 billion.
SWFs deployed $106.1 billion in 500 transactions and public pension funds poured $112.9 billion into 354 deals.
Singapore sovereign wealth fund GIC led the pack on dealmaking, deploying $34.5 billion, almost double the 2020 figure, in 110 deals.
“Almost half of that capital was invested in real estate, with a clear bias to logistics,” the report says.