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Singapore’s GLP and Canadian partners set up European logistics fund

Singapore-based Global Logistic Properties Limited (GLP) has teamed up with the Canada Pension Plan Investment Board (CPPIB) and Vancouver-based QuadReal Property Group (QuadReal) to launch a fund that is targeting to raise 2 billion euros (US$2.27 billion) to develop modern logistics facilities in several European countries.

The three partners are committing an initial 1 billion euros to the new GLP CDP I fund with CPPIB contributing 450 million euros, GLP says in a statement on November 19. It does not provide the amount contributed by the other two partners. A GLP spokesperson declined to disclose the figures.

The spokesperson tells Asia Asset Management that the fund has already raised the initial amount from the partners and that it will double to the target size when invested with leverage.

The fund will focus on developing logistics facilities in Germany, France, Italy, Spain, Netherland and Belgium.

This is the third European fund for GLP, an asset manager that specialises in real estate and logistics investment, underscoring the company’s move to tap the potential of increasing institutional demand for European logistics facilities. The other two funds were launched in December 2017.

The three funds will together have over 6 billion euros of assets under management (AUM) when they are fully invested, the statement says.

According to Ming Mei, co-founder and chief executive officer of GLP, the creation of the GLP CDP I fund reflects institutional investors’ confidence in his company and its European subsidiary, Gazeley.

“Demand from institutional investors to partner with GLP remains strong and we see opportunities to expand our fund management platform further,” he says in the statement.

This isn’t GLP’s first tie-up with CPPIB, which manages assets of the Canada Pension Plan, the country’s largest pension fund. In 2016, they jointly set up a $880 million fund to invest in modern warehouses in Japan.

“We expect GLP CDP I to grow quickly in scale and perform well over the long term given rising e-commerce sales and consumer demand for ever-shorter delivery times in Europe,” Andrea Orlandi, CPPIB’s managing director and head of real estate investments for Europe, says in the statement.

GLP’s current AUM is approximately $60 billion while property developer manages a $24.5 billion portfolio.

The Canada Pension Plan had $366.6 billion of assets as of June 2018.