The years-long bull run on equity markets that helped the Caisse de depot generate a 12 per cent return in 2014 is running out of steam and will require careful watching going forward, CEO Michael Sabia said Wednesday.

“We’re certainly not calling for a big correction…but it’s going to be increasingly difficult to replicate the kind of returns that we’ve seen everywhere basically since 2009,” Sabia told reporters in discussing the Quebec pension fund manager’s 2014 results.

That means the Caisse must continue to invest defensively in high quality assets, including real estate and infrastructure that have generated strong returns, he said.

Chief investment officer Roland Lescure said the double-digit returns of the past four to five years will end.

“In the next five years we should expect single-digit returns with double-digit volatility and that requires quality, quality, quality, but also the ability to be opportunistic.”

The large institutional investor said its assets as of Dec. 31, 2014, were $225.9 billion, even though investment return slowed slightly from 13.1 per cent in 2013.

All three of the Caisse’s major asset classes experienced gains, led by equities which had a nearly 14 per cent return as assets rose to $106.9 billion. Inflation-sensitive investments had an 11 per cent return, while fixed-income investments increased 8.4 per cent.

Sabia described the Caisse’s performance as “solid,” considering currency fluctuations, low interest rates and falling oil prices near year-end.

“Despite the volatility, we showed our resilience. We have stayed the course and that’s what counts.”

Its real estate division, Ivanhoe Cambridge, completed a record number of transactions in 2014 as shifted focused from hotels to multi-residential and logistics properties. It made acquisitions valued at $5.1 billion and sold properties worth $8.6 billion, including 21 hotels.

The division generated $2.1 billion of net investments in 2014 as its assets grew to $22.9 billion.

The Caisse’s infrastructure portfolio has more than doubled in four years to $10.1 billion, including $1.3 billion invested in 2014, when it enjoyed a 13.2 per cent annual return.

Sabia expects new investments will more than double the infrastructure portfolio again in the next few years as the Caisse creates a new subsidiary that will fund and build projects in Quebec and chase opportunities in the United States and elsewhere abroad.

“It is probably fair to say our No. 1 global priority is to substantially expand our infrastructure presence in the United States, where we think the needs are great,” he said.

The Caisse invested $2.5 billion in Quebec companies last year and more than $11 billion over four years, pushing its assets in the province to $60 billion.

However, it shifted five per cent of its Canadian exposure to other markets to capitalize on global growth. More than 47 per cent of its investments are outside the country.

Meanwhile, Sabia said the Caisse continues to have faith in two troubled Quebec companies — SNC-Lavalin (TSX:SNC) which faces bribery and corruption charges, and Bombardier (TSX:BBD.B) which is seeking new liquidity.

Sabia said SNC-Lavalin has made big ethics changes and is not the same company it was a few years ago. The Caisse has maintained its level of investment in the embattled engineering firm at about 10 per cent.

The Caisse also took advantage of Bombardier’s recent nearly $1-billion equity offering to increase its $271-million stake in the airplane and rail equipment manufacturer, but didn’t say by how much.