Canada Pension Plan Investment Board (CPPIB) has increased its exposure to the US multi-family market by committing $330m (€246m) to six developments.
The pension fund said the projects would produce luxury rental properties in California, Georgia and Massachusetts with a gross asset value of $740m.
It means that CPPIB has amassed direct joint venture interest in over 8,400 units in eight US multi-family markets since 2011. The institution has committed $1.3bn over the three years. The portfolio would be valued at $4.5bn if owned outright.
Peter Ballon, vice president and head of real estate investments for the Americas at CPPIB, said: “US multi-family investments remain an attractive sector for CPPIB.
“We believe that the limited supply of high-quality rental properties and other broad demographic trends such as forecast population growth, declining home ownership and the echo-boom generation reaching peak rental propensity all support continued growth in this sector.”
Two investments were made with existing joint venture partner Essex Property Trust: the acquisition of a 45% interest in the Pleasanton BART development in the San Francisco Bay area for $77m; a $39m commitment to develop the third phase of CPPIB’s existing Essex Epic development in San Jose, California.
CPPIB also expanded its joint venture with AMLI Residential by buying 45% stakes in two projects in Atlanta, Georgia for $117m: AMLI Arts Centre in Midtown and AMLI CityPlace in Buckhead.
A 44% interest in the Block 6 project in San Francisco was acquired for $90m. CPPIB is investing alongside Mutli-Employer Property Trust (MEPT) and developer Golub & Company.
CPPIB also committed $11m to develop and hold the Avalon North Point Lofts development in Cambridge, Massachusetts, alongside joint venture partners AvalonBay and Allianz.
