GLOBAL – The Canada Pension Plan Investment Board (CPPIB) is to grow its CAD1.5bn (€1bn) Brazilian real estate holdings further after it agreed to invest $240m (€173m) in residential property in the country.
Under the terms of the venture with Banco BTG Pactual, the CAD189bn CPPIB will own a 40% stake in the venture and have a seat on its investment committee.
BTG, which will match the Canadian fund's contribution, will act as investment adviser and contribute $240m in capital, investing alongside local developers.
Peter Ballon, vice-president and head of real estate investments for the Americas at CPPIB, said the venture would allow for "an attractive entry point" to Brazilian residential property and allow the fund to expand its real estate holdings in the country.
"The fundamentals of Brazil's residential development sector are compelling as a growing middle class, increased economic activity and favourable demographic shifts drive increased demand for new housing," he said.
"Brazil remains a strategic market for CPPIB over the long term, and we will continue to seek attractive investment opportunities through partnerships with top-tier local partners."
In August, CPPIB announced it would acquire a 27.6% stake in Aliansce Shopping Centres for $480m.
The fund currently owns Brazilian retail, office and logistics properties worth CAD1.5bn, accounting for 7% of its CAD21bn real estate portfolio.