GSIS eyes new income stream: Constructing and renting out buildings 

Government Service Insurance System (GSIS), the pension fund for state employees, on Friday said it is taking on an active role the real estate industry to generate a new income stream starting this year.

 

"We are looking at the possibility of building government buildings that may take on other government agencies as tenants to generate investment income,” GSIS president and general manager Robert Vergara told reporters in briefing.

 

“We already received interests from other government agencies that are currently occupying old buildings," he said.

 

"But that is not easy because it takes approximately 18 months to get the buildings ready.... However, that is something that we are planning to do as a way to generate income from our assets," Vergara said. 

 

Another option GSIS is looking at is investing in commodities in the global market. "We hope that the US economy will stabilize... China could also avoid a hard landing,” according to the GSIS chief. 

 

"But we have to see what are the alternative asset classes that we can tap which are currently not in our active portfolio," he said. He said this was included in a study done by the agency board when it did its planning for 2013.

 

The pension fund is also eyeing infrastructure projects—seaports, airports, roads, power plants—and is on the lookout for winning bidders in public-private partnership projects this year and possibly join a consortium. 

 

"We are expecting the government ramping up infrastructure projects... We may be able to join them at an equity level," he said.

 

Latest GSIS data showed it has total assets of around P700 billion, with 15 percent placed in equities, 45 percent in fixed income instruments, 30 percent in loans, and 5 percent in real estate properties, and 5 percent is in cash. — VS, GMA News