GIC, CPPIB to acquire Seoul mall for $263m

The two institutional investors have formed a 50:50 joint venture partnership to acquire a retail mall in Seoul.  

GIC Private, the Singaporean sovereign wealth fund, and the Canada Pension Plan Investment Board (CPPIB) have formed a joint venture partnership to acquire a retail mall in Seoul for $263 million. The deal marks CPPIB’s first retail investment in South Korea.

The state two funds will each own a 50 percent stake in D-Cube retail mall after its acquisition from the Korean firm Daesung Industries.

The mall, which reached practical completion in 2011, will be rebranded as a Hyundai Department Store. In a statement announcing the partnership the partners said that the Seoul-headquartered conglomerate will work alongside GIC and CPPIB to reposition the mall to better serve the Korean retail market’s expected steady growth over the long term.

“Our investment in the D-Cube retail mall reflects our confidence in the long-term growth of Korean domestic demand and is consistent with our strategy of acquiring high-quality, centrally-located assets with upside potential,” said Loh Wai Keong, managing director and co-head for Asia at GIC Real Estate. “As a long-term value investor, our interests are aligned with CPPIB and we look forward to partnering with them in this acquisition.”

Jimmy Phua, managing director and head of real estate investments for Asia at CPPIB, added: “The D-Cube retail mall is a prime retail asset located in a growing and affluent area, and through this investment, we are pleased to gain exposure to one of the largest retail markets in Asia, working alongside experienced and aligned partners.”

CPPIB, which has more than $22 billion in real estate investments, has been actively adding to its portfolio in Asia. In January this year, it committed RMB 1.2 billion (€170.57 million; $201.47 million) in a partnership with Beijing-based developer Longfor Properties for a mixed-use development project, understood to be CPPIB’s first direct joint venture in mixed-used development in China.

Singapore-headquartered GIC has been charting new markets and increasing its exposure to overseas markets of late. Its most recent international foray came in March and was the formation of a €300 million Europe-focused logistics partnership with Exeter Property Group, the Pennsylvania-based real estate investment firm, to pursue value-add investments in the sector.