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CPPIB-Goodman China JV reaches $2bn

Toronto-based pension plan investor Canada Pension Plan Investment Board has allocated $400 million in equity to its industrial venture with Goodman in China. 

The Canada Pension Plan Investment Board (CPPIB) has allocated an additional $400 million in equity to its industrial joint venture in China with Sydney-based logistics developer, Goodman. 

With Goodman further contributing $100 million in equity, the total value of Goodman China Logistics Holding venture has reached $2 billion. 

The venture has invested in 27 logistics properties across different markets in China, including Shangai, Beijing, Tianjin and Chengdu, so far.

“CPPIB additional equity reflects the success of the JV to date and the longstanding partnership we have with Goodman. The fundamentals of the Chinese logistics and e-commerce sectors remain compelling, which underpin the growth in demand for prime logistics facilities,” said Jimmy Phua, managing director and head of real estate investments in Asia for CPPIB.

The $500 million capital raise is the fourth equity increase to the joint venture since its inception in 2009, according to a statement released by Goodman.

Philip Pearce, Goodman’s managing director for greater China, further added that the firm has a “strong pipeline of projects in China and are supported by extensive resources, quality people and access to significant land.”

CPPIB’s relationship with Goodman extends beyond China. The two have, in the past, teamed up for logistics investments in Australia, Hong Kong and the US. In August this year, the pension plan contributed an additional $500 million in equity for the Goodman North American Partnership, which was launched in 2012. The total size of the partnership currently stands at $2 billion, with CPPIB’s contribution totaling $900 million in equity. 

CPPIB has been actively expanding its logistics portfolio, with a series of equity commitments made this year. Last month, it allocated ¥15 billion ($138.69 million; €108.95) to its existing Japanese industrial joint venture with Singapore-listed logistics real estate developer and investment manager, Global Logistic Properties followed by an additional R$738 million ($299.81million; €235.40 million) to its multiple partnerships with GLP in Brazil.

CBBIP is one of the world’s biggest pension funds, with more than $203 billion of assets under management. Of this, $22 billion represents real estate investments.