The Canada Pension Plan Investment Board is making an additional investment in the Goodman China Logistics Partnership, bringing its total equity commitment to US$5 billion.

The partnership, established in 2009 with multi-national property firm the Goodman Group, set out with the purpose of developing logistics properties in key gateway cities in mainland China. Since inception, the portfolio has grown to include 33 properties, making up 2.5 million square metres, which are 99 per cent tenant-occupied.

Read: CPPIB boosts equity allocation to China partnership

“The fundamentals of the Chinese logistics sector remain compelling, driven by domestic consumption growth in China, including e-commerce which underpins the strong demand for prime logistics facilities,” said Jimmy Phua, managing director and head of real estate investments for Asia at the CPPIB, in a press release. “CPPIB’s additional equity reflects the success of GCLP to date and an opportunity to expand our long-standing global partnership with Goodman.”

The CPPIB is making the bulk of the contribution, allocating US$1.4 billion, while Goodman is investing US$350 million.

“With its growing middle class, significant e-commerce activity and rapid advancements in technology, China is a core growth area for our business,” said Greg Goodman, chief executive officer of Goodman Group, in the release. “Our increased commitment alongside our long-term partner in CPPIB, will provide sufficient equity to leverage opportunities in the market.”

Read: CPPIB invests in Korean logistics facilities

Copyright © 2020 Transcontinental Media G.P. Originally published on benefitscanada.com

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