Investment Strategy
Hostplus is one of Australia’s largest industry superannuation funds, managing approximately $100 billion in retirement savings. The fund was established in 1988 to serve workers in Australia’s hospitality, tourism, recreation, and sport industries. Through mergers and organic growth, Hostplus has expanded significantly and now serves over 1.7 million members across these and related sectors.
Hostplus’s membership base is characterized by a relatively young average age and a high proportion of part-time and casual workers, reflecting the demographics of the hospitality and tourism workforce. This young membership profile gives the fund an exceptionally long investment horizon, as the average time between contribution and retirement benefit is longer than for funds with older demographics.
The fund’s default Balanced investment option employs an aggressive growth allocation that takes advantage of this long horizon. The portfolio spans Australian and international equities, fixed income, private equity, venture capital, infrastructure, real estate, and private credit. Hostplus’s asset allocation is notably more heavily weighted toward growth and illiquid assets than many peer funds, reflecting the investment team’s conviction that the fund’s long horizon supports higher allocations to these return-generating asset classes.
Hostplus has been a consistent strong performer among Australian super funds over long-term measurement periods. The fund attributes much of this performance to its willingness to maintain high growth allocations and its early and significant investments in private equity and venture capital.
Private Markets Approach
Hostplus’s private markets program is one of the largest and most established in the Australian superannuation industry. Alternatives represent approximately 25% of the Balanced option, spanning private equity, venture capital, infrastructure, real estate, and private credit.
Private equity and venture capital are signature allocations for Hostplus. The fund was an early adopter of PE and VC investing among Australian super funds and has built a substantial portfolio of GP relationships across buyout, growth equity, and venture strategies. Hostplus invests globally, with significant commitments to North American, European, Asian, and Australian GPs. The fund has been notably open to venture capital, including early-stage technology investing, which has differentiated it from many Australian peer funds. Hostplus’s VC portfolio includes exposure to leading global venture managers.
Infrastructure is a major allocation. Hostplus invests in infrastructure through IFM Investors, a specialist investment manager owned by Australian industry super funds, as well as through other external managers and direct co-investments. The portfolio includes exposure to airports, toll roads, ports, utilities, renewable energy, and digital infrastructure assets globally.
Real estate investments span Australian and international property exposure. Hostplus invests through external property managers, co-investments, and pooled vehicles. The fund’s real estate portfolio includes commercial, industrial, residential, and logistics property.
Private credit has been a growing allocation, with investments in direct lending, structured credit, and specialty finance strategies. These investments provide yield enhancement and diversification relative to the public fixed income portfolio.
Hostplus’s approach to private markets is characterized by a willingness to take conviction positions and allocate to strategies that other super funds may consider non-traditional. The fund has been open to emerging managers, innovative fund structures, and newer strategies alongside its commitments to established large-cap GPs. This approach has contributed to portfolio diversification and strong long-term returns.
Frequently Asked Questions
How much does Hostplus allocate to alternative investments?
Hostplus allocates approximately 25% of its default Balanced option to alternative investments, including private equity, venture capital, infrastructure, real estate, and private credit. Hostplus is known among Australian super funds for its substantial allocation to private equity and venture capital, which has been a significant contributor to the fund's long-term performance. The fund has one of the largest PE and VC programs in the Australian superannuation industry.
What is Hostplus known for in the investment world?
Hostplus is widely recognized for its pioneering approach to private equity and venture capital investing among Australian superannuation funds. The fund was an early and significant LP in domestic and global private equity and venture capital, building exposure to these asset classes at a time when many Australian super funds had minimal allocations. Hostplus's willingness to invest in venture capital, including early-stage technology companies, has differentiated it from peers and contributed to strong long-term returns.
How can fund managers engage with Hostplus?
Hostplus manages its private market allocations through an internal investment team and external investment consultants, notably IFM Investors and other specialist advisors. GPs can approach the fund through its investment team in Melbourne. Hostplus evaluates managers on track record, strategy differentiation, team quality, and alignment of interests. The fund has been open to a broader range of strategies than some peers, including venture capital, emerging managers, and innovative fund structures.
