Canada Pension Plan Investment Board (CPPIB) has deployed a further US$1 billion in equity to the Goodman China Logistics Partnership, which owns and develops logistics assets in Mainland China. Goodman Group, CPPIB’s partner in the venture, has also committed a further US$250 million. CPPIB and Goodman, which began investing together in 2009, said the partnership has continued to see strong demand in China’s core logistics markets, including in Shanghai and Beijing. Separately, it was announced that the partnership will buy nine projects valued at US$650 million from Goodman.
Canada Pension Plan Investment Board and Goodman Increase China Equity Commitment by US$1.25 Billion and Acquire Nine Projects
Toronto, Canada and Sydney, Australia (December 21, 2015) — Canada Pension Plan Investment Board (CPPIB) and Goodman Group (Goodman or Group) are pleased to announce a US$1.25 billion increase in their equity allocation to the Goodman China Logistics Partnership (GCLP or Partnership). The equity allocation will be made on an 80:20 basis, with CPPIB committing US$1 billion and Goodman committing US$250 million, consistent with the Partnership’s equity structure.
GCLP was established by CPPIB and Goodman in 2009 to own and develop logistics assets in Mainland China. GCLP is seeing continued strong demand in core logistics markets, including in the greater Shanghai and Beijing regions and key Western China markets, driven primarily by e-commerce and domestic consumption. The Partnership will continue to focus on key locations, where land constraints and demand are strongest.
Separately, GCLP will acquire nine projects (including land) from Goodman Group, with an end build out value in excess of US$650 million.
Jimmy Phua, Managing Director and Head of Real Estate Investments, Asia, said: “CPPIB’s additional equity reflects GCLP’s success to date and the longstanding partnership we have with Goodman. We continue to see China as a strong investment market for a long-term investor like CPPIB. In particular, the fundamentals of the Chinese logistics and e-commerce sectors which underpin the growth in demand for prime logistics facilities remain compelling.”
Greg Goodman, Group CEO said, “CPPIB is an important global partner for Goodman and we are delighted to further build on our well-established relationship. With this increase in equity allocation and acquisitions, our China platform will be strengthened across key markets and provide full alignment for the ongoing expansion of the portfolio.”
GCLP was established in 2009 with an initial equity commitment of US$300 million, and Goodman and CPPIB have regularly increased their commitment to the Partnership through additional equity to support the growth of the business every year since 2012.
Canada Pension Plan Investment Board (CPPIB) is a professional investment management organization that invests the funds not needed by the Canada Pension Plan (CPP) to pay current benefits on behalf of 18 million contributors and beneficiaries. In order to build a diversified portfolio of CPP assets, CPPIB invests in public equities, private equities, real estate, infrastructure and fixed income instruments. Headquartered in Toronto, with offices in Hong Kong, London, Luxembourg, Mumbai, New York City and São Paulo, CPPIB is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. At September 30, 2015, the CPP Fund totalled C$272.9 billion. For more information about CPPIB, please visit www.cppib.com.
Goodman Group is an integrated property group with operations throughout Australia, New Zealand, Asia, Europe, the United Kingdom, North America and Brazil. Goodman Group, comprised of the stapled entities Goodman Limited, Goodman Industrial Trust and Goodman Logistics (HK) Limited, is the largest industrial property group listed on the Australian Securities Exchange and one of the largest listed specialist investment managers of industrial property and business space globally.
Goodman’s global property expertise, integrated own+develop+manage customer service offering and significant investment management platform ensures it creates innovative property solutions that meet the individual requirements of its customers, while seeking to deliver long-term returns for its Partners.
For more information please visit www.goodman.com.
Photo courtesy of Goodman Group