Canada Pension Plan Investment Board has agreed to partner with ESR and its Seoul-based subsidiary Kendall Square Asset Management to invest up to $500 million in a newly established investment vehicle targeting modern logistics facilities in South Korea. Kendall Square will identify new assets, support the acquisition and provide asset management services to the portfolio.
South Korea’s position as the most connected country in the world, and continuing embrace of e-commerce, provides an attractive opportunity. The portfolio will be comprised of class A facilities in key locations servicing diverse tenant demands.
The vehicle will initially invest in a seed portfolio of six logistics facilities with an aggregate gross floor area of 2.9 million square feet that are already managed by Kendall Square. The vehicle will target additional investments in core to value-added assets to complete the investment commitments.
CPPIB and ESR have a well-established investment relationship, working together in the Korean logistics sector since 2015.
Recently, CPPIB Credit Investments, a wholly owned subsidiary of CPPIB, has agreed to participate in A$500 million ($370 million) of seed lending to a newly established fund with Challenger Investment Partners (CIP) to invest in middle-market real estate loans in Australia and New Zealand.
And CPPIB and Longfor Group have expanded their relationship to launch a new investment cooperation that will focus on rental housing programs in China with an initial targeted investment of approximately $817 million.
