Canada Pension Plan Investment Board (CPPIB) has formed a new venture with China Vanke, the largest residential developer in China. CPPIB said it will invest US$250m in the Chinese residential market.
The venture will focus on new residential development projects in large cities across China with rising incomes and strong economic fundamentals. Vanke will source projects for the partnership.
CPPIB and Vanke are investing in a project located in Qingdao, in the Shandong province in China to seed the venture.
Graeme Eadie, senior vice-president of real estate investment for CPPIB, said: “We see this as an excellent opportunity to expand our presence in the country and invest in the residential sector. Asia continues to be an important real estate market for CPPIB and one where we already have significant investments in the commercial property and logistics sectors.”
CPPIB’s investments in Asia represented 11.6% of the total portfolio as of year-end 2013. Vanke has developed over 500,000 residential units and manages over 400 residential communities.