The Canada Pension Plan Investment Board (CPPIB) formed a joint venture with Chinese real estate company Longfor Properties Co Ltd to invest 7 million for a 49 percent stake of a shopping center in Chongqing, the CPPIB revealed on Friday.
The project, known as Chongqing West Paradise Walk, was the first retail mall investment in the southwestern Chinese city by the CPPIB, which manages one of the world's largest pension funds.
The joint venture was the second entity the CPPIB established with Longfor Properties in China. Their first joint venture was formed in 2014 to develop a mixed-use real estate project in Suzhou, Jiangsu province.
"We are pleased to extend our existing relationship with Longfor Properties through this joint venture in West Paradise Walk, a well-located shopping centre in one of China's largest cities," said Jimmy Phua, Managing Director and Head of Real Estate Investments in Asia at the CPPIB.
"This joint venture fits well with our investment strategy and allows us to invest alongside a highly experienced partner in a high-quality real estate asset that will provide attractive risk-adjusted returns over the long term," Phua said.
Kenny Tse, Managing Partner of Pinnacle Real Estate Capital Partners said the latest joint venture reflected the strong desire from CPPIB and Longfor to extend their sustainable partnership to capture the secular growth prospects in China's domestic consumption and commercial real estate trends in major cities.