Canadian Pension Fund Unloads Stakes In $6B U.S. Industrial Fund, Chinese JVs
Canada Pension Plan Investment Board will sell its 45% stake in the Goodman North American Partnership, a $6B fund, as well as its 49% interest in four Chinese joint venture projects with Longfor Group Holdings.
CPP Investments expects to receive $2.2B from the $6B GNAP fund sale, the company said in a Friday announcement. Canada's largest pension manager and Australia’s Goodman Group started GNAP with a 45% and 55% respective investment split in 2012 to invest in high-quality logistics and industrial properties in North America, according to the announcement.
The $2.2B realization crystallizes “strong returns over the life of the investment,” the company said. The statement did not identify the buyer of the stake, but Alternatives Watch reported that Norway’s Norges Bank Investment Management bought out CPP Investments’ interest.
“The proceeds from this transaction also give us the ability to redeploy capital towards new investment opportunities as our portfolio continues to grow and evolve alongside the global market,” Max Biagosch, global head of real assets and head of Europe for CPP Investment, said in the press release.
CPP Investments and Goodman Group committed about $900M when they formed the venture and injected more over the years, including $1.1B in 2014 and $2.5B in 2020, Real Estate News Exchange reported.
GNAP has a portfolio of 28 properties with a 99.7% occupancy rate, according to its website. It targeted West Coast logistics hub markets of Los Angeles, the Inland Empire, San Francisco and Seattle as well as New Jersey and Philadelphia on the East Coast.
Since its launch, GNAP identified and secured a development pipeline of $3.1B, providing 13M SF of warehouse distribution product, the website states.
“The portfolio exemplifies high quality buildings in excellent locations,” said Edward Lerum, head of global logistics real estate at Norges, according to Alternatives Watch. “We have long-term conviction in the investment, and we also see appealing growth potential, given the restrictions on new supply in these locations.”
CPP Investments is also selling its 49% interest in four real estate JV projects with Chinese real estate company Longfor Group Holdings to an affiliate of Dajia Insurance Group, the company said in a separate Friday announcement. CPP Investments will net about $163M from the sale before closing adjustments.
CPP Investments first partnered with Longfor in 2014. The properties in the sale include four retail malls and connected office and rental housing properties in Shanghai, Suzhou, Chengdu and Chongqing, according to the announcement.
The companies “still have a number of joint ventures in China” following the transaction, the statement said.
CPP Investments had 21% of its holdings in the Asia-Pacific region as of March, and those holdings earned a net return of 0.1% in 2024, Investment Executive reported.
The CPP fund held $469B worth of assets in September 2024, according to its website. The pension manager announced last year that it planned to pare back its real estate exposure to 8% in 2024, down from 12% in 2019.
