Cbus posts record year for super fund as it rides out pandemic

The $61bn super fund for the construction and building sector has reported its best ever performance as it successfully navigated pandemic volatility.

The $61bn super fund for the construction and building sector has reported the best performance in its 37-year history as it successfully navigated pandemic volatility.

Cbus Super yesterday announced a 19.34 per cent return for its growth option last financial year as it invested heavily in housing developments around the country.

The result comes a day after AustralianSuper, the country’s largest super fund, posted a record return of 20.43 per cent on its balanced fund boosted by strong growth in the sharemarket in Australia and overseas.

CBus Super chief investment officer Kristian Fok said the fund had managed its cashflow exceedingly well during the initial Covid-19 volatility meaning it could invest in the upswing. “Cbus was one of a small group of funds to achieve a positive result during the previous financial year,” said Mr Fok.

“To then have the confidence to get back into the market is testament to the people and structures that we have put in place over the last five years.”

He said Cbus Super, which has about 780,000 members, now manages 35 per cent of its assets in-house allowing a reduction in investment fees of $400m since 2017. 

The fund’s focus on increasing scale and reduced fees should serve members well as market conditions became more difficult in the year ahead.

Cbus chief investment office Kristian Fok. Britta Campion / The Australian

“Obviously we would love to see double-digit returns like this every year but indications are that conditions will become tougher,” Mr Fok said. 

The strong performance of Cbus and AustralianSuper comes as once-dominant retail funds such as AMP have struggled and the big banks have exited the super and wealth management sector. Last year’s performance was helped by strong stimulus measures, confidence about the vaccine rollout and a broadening of equity market performance beyond tech stocks.

Cbus Super chief executive Justin Arter said the fund’s expertise in property had benefited both members and the wider economy as the country struggled out of lockdowns.

”There were stages last year when quality developments were struggling to get the finance they needed,” said Mr Arter. “As banks were tightening lending, we were able to support successful developments to keep going at a pivotal time for the construction industry.”

He said lending by the fund had resulted in the construction of 862 new residential units, helping support construction jobs and property supply. Its property division, Cbus Property, released 471 apartments to the market during the financial year.