CPPIB, GIC buy student housing portfolio for $1.4bn

The acquisition marks the Canadian pension plan’s entry into US student housing, following its UK debut in the space last year.

The Canada Pension Plan Investment Board (CPPIB) has partnered with the Singapore’s sovereign wealth fund, GIC Private Limited, to purchase a US student housing portfolio for $1.4 billion.

The institutional investors formed a joint venture, Scion Student Communities, with The Scion Group, a Chicago-based private owner and operator of student housing, to buy the portfolio and make future investments, the groups said Monday.

The first purchase through the joint venture, University House Communities Group (UHC), comprises almost 13,000 beds across 18 stabilized properties, along with four projects in development, according to the announcement. CPPIB and GIC each own a 47.5 percent stake in the portfolio, and Scion owns the remaining 5 percent. The groups bought the portfolio from InvenTrust Properties, an Oak Brook, Illinois-based real estate investment trust.

“The UHC portfolio represents a valuable opportunity to enter the US student housing sector with top-tier, well-located assets,” said Peter Ballon, CPPIB’s head of Americas real estate investments, in a statement. “This transaction enables us to gain immediate scale in the attractive US student housing market.”

In March, CPPIB entered the UK market with the acquisition of Liberty Living, one of the UK’s largest student accommodation providers, for £1.1 billion (€1.52 billion; $1.67 billion). The pension plan then added another UK portfolio for £330 million in August. Headquartered in Toronto, CPPIB managed C$272.9 billion (€181.4 billion; $196.5 billion) in assets as of September 30, including C$34.3 billion in real estate investments.

Last May, CPPIB and GIC formed a joint venture partnership to acquire a retail mall in Seoul for $263 million.