CPP Investments ramps up Canadian industrial exposure with $3 billion acquisition platform
Canada Pension Plan Investment Board is putting $1bn into a new industrial real estate joint venture in Canada, sharply increasing its exposure to “last-mile” logistics assets as it looks to capture long-term income and growth in the sector, according to a press release.
CPP Investments is partnering with Dream Industrial Real Estate Investment Trust and Dream Asset Management Corporation in a joint venture that will target industrial properties in major Canadian markets, as per a press release.
The partners have allocated $1.1bn of equity capital, including $1bn from CPP Investments for a 90 percent stake and $0.1bn from Dream Industrial for the remaining 10 percent, according to the press release and The Canadian Press.
The partners expect this equity to support the acquisition of about $3bn of industrial assets “strategically located in Canada’s major markets, offering excellent connectivity to population clusters and arterial transport routes,” as per the press release.
As an initial step, the joint venture has agreed to acquire 12 Canadian industrial assets totalling 27 buildings and 3.6 million square feet across Ontario, Quebec and Alberta from Dream Industrial for $805m.
A subsidiary of Dream will act as asset manager for the joint venture, while a subsidiary of Dream Industrial will provide property management and leasing services, as per the press release.
“The Canadian industrial sector continues to demonstrate resilient demand and meaningful long-term growth drivers, supported by a structurally high need for well-located space as supply chains and logistics continue to evolve,” said Sophie van Oosterom, managing director and head of real estate at CPP Investments, in the press release.
Van Oosterom said partnering with Dream allows CPP Investments to efficiently scale its exposure in the Canadian market to capture that growth and drive long-term value for CPP contributors and beneficiaries.
