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CPPIB gives initial commitment of US$500 million, with option of acquiring existing IndoSpace pipeline worth approximately US$700 million; shows industrial real estate sector as up-and-coming investment destination for institutional funds
Singapore, 22 May 2017 – Canada Pension Plan Investment Board (CPPIB) and IndoSpace, India's largest developer of modern industrial and logistics real estate, have announced the launch of IndoSpace Core, a joint venture that will focus on acquiring and developing modern logistics facilities in India. This will be the largest industrial and logistics investment in India to date.
JLL and Citigroup acted as advisors on behalf of IndoSpace.
In its largest foray into Indian Industrial logistics, CPPIB has initially committed approximately US$500 million to the joint venture and will acquire 13 well-located industrial and logistics parks totalling approximately 14 million square feet. IndoSpace Core has the option to acquire additional industrial and logistics parks totalling approximately 11 million square feet, worth approximately US$700 million as well as participate in any future development pipeline.
"This landmark transaction represents a growing trend for institutional investors to take a stake in India's rapidly modernising economy," says Stuart Crow, JLL Asia Pacific Head of Capital Markets. "While the logistics sector was seen as underdeveloped and with limited investment opportunities, it is now being recognised as an institutionally attractive asset class, set to benefit from the growth of progressive government policies and continued foreign direct investment in India."
Shobhit Agarwal, a Managing Director in JLL India Capital Markets team adds: "India's logistics sector continues to offer investors an attractive long-term income return given longer occupational leases, with fixed rental uplifts and higher yield compared to the office and retail sectors. We can definitely expect to see a rising volume of international and domestic institutional interest in the industrial sector in the future."
IndoSpace is a joint venture between the Everstone Group and Realterm. The Everstone Group is a premier India and South East Asia focused private equity and real estate firm with over $3.3 billion under management. Realterm is an industrial real estate firm that manages over $2.5 billion across over 300 operating and development properties in North America, Europe and India.
CPPIB, headquartered in Toronto, is a global investment management company with a track record of investing in the Indian real estate market.
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JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. A Fortune 500 company, JLL helps real estate owners, occupiers and investors achieve their business ambitions. In 2016, JLL had revenue of $6.8 billion and fee revenue of $5.8 billion and, on behalf of clients, managed 4.4 billion square feet, or 409 million square meters, and completed sales acquisitions and finance transactions of approximately $136 billion. At the end of the first quarter of 2017, JLL had nearly 300 corporate offices, operations in over 80 countries and a global workforce of more than 78,000. As of March 31, 2017, LaSalle Investment Management had $58.0 billion of real estate under asset management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com.
JLL has over 50 years of experience in Asia Pacific, with 36,800 employees operating in 95 offices in 16 countries across the region. The firm won the 'World's Best' and 'Best in Asia Pacific' International Property Consultancy at the International Property Awards in 2016 and was named number one real estate investment advisory firm in Asia Pacific for the sixth consecutive year by Real Capital Analytics. www.ap.jll.com.
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