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CPPIB opens office in Brazil

The C$192.8 billion pension plan, which has invested C$1.5 billion in real estate in the Latin American nation, also has established a new office in New York.

Canada Pension Plan Investment Board (CPPIB) has opened an office in Sao Paulo to focus on investment opportunities in Latin America. The new location, along with last month’s opening of an office in New York, are CPPIB’s first offices in the Americas outside of its Toronto headquarters.

“Latin America is expected to be a leading source of global growth in the decades ahead,” said Mark Wiseman, President & Chief Executive Officer, CPPIB. “CPPIB already has significant investments in the region, with nearly C$5 billion (€3.33 billion; US$4.5 billion) invested in real estate, public and private equity and infrastructure investments. The office will support our efforts to gain access to the best investment opportunities in the region and will help us to continue to forge important relationships with local partners.”

Similar to its offices in London and Hong Kong, which act as CPPIB’s regional bases in Europe and Asia, respectively, Sao Paulo will serve as the Latin American headquarters for CPPIB. The pension plan will focus primarily on investments in the five target markets of Brazil, Chile, Colombia, Mexico and Peru.

Real estate is the predominant asset class in Brazil that CPPIB has invested in, the institutional investor said in an email to PERE, adding: “Brazil is particularly attractive from a long-term growth perspective for real estate development. Brazil’s significantly evolving middle class is helping to drive demand for retail space and positive economic growth there necessitates a supply of high-quality industrial space.”

The Sao Paulo office, which is expected to be operational by April, will initially be staffed with two real estate investment professionals and an office manager, with the intention of expanding to a dozen employees in about a year. A Brazil office head has not yet been determined.   

To date, CPPIB’s real estate investments in Latin America have been exclusively in Brazil, where it had amassed a property portfolio valued at C$1.5 billion as of September 30, 2013. The portfolio includes interests in retail, office and logistics properties totaling more than 4.1 million square meters (44 million square feet), including development assets.

CPPIB’s most recent property investments in the country include the purchase of a 40 percent interest in a venture with Banco BTG Pactual S.A. (BTG) to develop residential properties in Brazil for US$240 million in equity last October; and the acquisition of a 27.6 percent interest in Brazilian retail owner Aliansce Shopping Centers S.A. from General Growth Properties, Inc. for US$480 million in equity last July. 

CPPIB also began operations in New York City’s midtown Manhattan last month, although its new office there will act more as a satellite location than a regional headquarters. The New York office initially will have four employees. CPPIB has invested more than C$60 billion invested across various asset classes in the US.