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Canada Pension Plan Investment Board (CPPIB) will invest $500 million in a new joint venture with real estate developer IndoSpace to focus on acquiring and developing modern logistics facilities in India.
IndoSpace currently has 21 industrial and logistics parks across India.
It is a joint venture between the Everstone Group and Realterm.
Managing the ventureIndoSpace Capital Asia will manage the new entity, IndoSpace Core, although CPPIB will own a majority stake.
IndoSpace Core has committed to acquiring 13 well-located industrial and logistics parks, totalling some 14 million square feet, from current IndoSpace development funds.
The joint venture will acquire the first nine facilities totalling approximately nine million square feet at closing, and the additional facilities within 24 months.
The assets are located in prime industrial properties located in the top industrial and logistics hubs in India, including Chennai, Pune, Mumbai, Delhi and Bengaluru.
Acquiring assetsIndoSpace Core has the option of acquiring additional industrial and logistics parks totalling approximately 11 million square feet, which are currently being developed by IndoSpace funds, and are worth approximately $700 million.
This would take the total deal size to be around $1.3 billion, according to sources.
Sources further added that about $100 million from the total $1.3 billion would go into the $650-million IndoSpace Fund III, which will be launched later.
IndoSpace, formed in 2009, has so far set up two funds — $240 million in 2009 and $344 million in 2014 — to invest in logistics and real estate in India.
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