CPPIB, Goodman joint venture to buy U.S. industrial property

Australian industrial property manager Goodman Group and Canadian pension fund manager CPPIB announced a plan on Thursday to expand their relationship via the launch of a new logistics and industrial venture.

The venture, Goodman North America Partnership (GNAP), will make targeted investments in U.S. logistics hubs such as Los Angeles, San Francisco and Seattle on the West Coast, and New York, New Jersey and Philadelphia on the Eastern Seaboard.

In a joint statement, the two firms said GNAP will have a total equity investment of $890 million, with Goodman investing 55 percent, or $490 million, and CPPIB investing the remaining $400 million.

Goodman, the largest industrial property manger listed on the Australian Securities Exchange, and the Canadian Pension Plan Investment Board – better known as CPPIB – have partnered in the past on investments in Hong Kong, Australia and China.

In December, Goodman and CPPIB expanded their joint venture in China, formed in 2009, to own and develop logistics assets in mainland China.

Toronto-based CPPIB manages funds for the Canadian Pension Plan. It invests in a wide range of assets and instruments. As of March 31, the fund was worth C$161.6 billion ($163 billion).

CPPIB, along with its Canadian peers such Ontario Teachers’ Pension Plan and Caisse du depot et placement, are among the world’s most active dealmakers in recent years, making major bets both in Canada and overseas.

The fund manager said the GNAP venture represents CPPIB’s first direct investment in U.S. industrial real estate.

“This latest partnership broadens CPPIB’s successful relationship with Goodman,” said Peter Ballon, CPPIB’s head of real estate investments in the Americas. “We believe that this joint venture will provide significant opportunities to invest in prime logistics and industrial locations across key American markets.”

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