According to sources, Japan's Government Pension Investment Fund (GPIF) has formed a partnership with Development Bank of Japan (DBJ) and Ontario Municipal Employees Retirement System (OMERS) to jointly invest in infrastructure assets in developed countries.

The source said that GPIF plans to invest about US$2.7 billion or around 0.2% of the fund assets. Japan's DBJ plans to invest around US$100 million in the fund.

The co-investment will be structured as a unit trust with Japan's Nissay Asset Management and New York-based investment consultant Mercer Investments supervising the fund.

GPIF currently invests 60% of its funds in Japanese bonds, the rest being allotted to foreign bonds as well as domestic and international stocks.

The announcement of the partnership comes three months after a government-appointed panel issued a report recommending Japan's pension funds increase their commitments to alternative assets. The panel was formed as part of a series of policy changes brought in by Prime Minister Shinzo Abe in a bid to restore growth to the nation's economy.