– London-based Grosvenor Fund Management (GFM) and the Canada Pension Plan Investment Board (CPPIB), based in Toronto, announced today that they have formed a joint venture partnership to invest up to $310 million in London’s West End office market over the next two years. CPPIB will invest $295 million in the JV and GFM will invest $15.5 million.
The Partnership’s strategy is to invest in West End and Midtown value-added office opportunities. Scott Rowland, Commercial Fund Manager at GFM and his team will use their extensive knowledge of this sector to identify opportunities to invest in depreciated properties that can be refurbished to a Class A standard. The JV is targeting individual properties worth up to $155 million.
Graeme Eadie, Senior Vice President, Real Estate Investments at CPPIB, said: “This venture with Grosvenor Fund Management provides us with an entry point into an attractive, niche commercial real estate market in West End London. This investment aligns with our existing European real estate investment strategy and introduces us to a well-respected partner with unique knowledge of the West End office market and access to local stakeholders.”
Mervyn Howard, GFM Director, added: “We are delighted to have formed this venture with CPPIB, which shares our belief in the future strength of the central London office market. Grosvenor and Grosvenor Fund Management have been active in the London office market through many cycles. We have the in-house skills to execute the strategy of the Partnership, and we believe the timing is right. This new partnership is a perfect complement to the strategy of the Grosvenor London Office Fund, which currently owns four prime West End office properties.
About Grosvenor Fund Management:
Grosvenor launched its first fund in 1976 and formally established Grosvenor Fund Management (GFM) in 2005. GFM offers a range of sector and regional specialist property investment funds which aim to deliver attractive, risk adjusted returns. Operating from offices in China, France, Italy, Japan, Luxembourg, Spain, the UK and the USA, we employ professionals with local knowledge and skills to execute our investment decisions. Aligning our interests with our partners and building long-term investor relationships is of paramount importance to us. As of December 31, 2010, funds under management were $6.0bn with 70 investor partners in 24 funds and separate accounts. For further details, please see our Annual Report & Accounts available at www.grosvenor.com
About Canada Pension Plan Investment Board:
The Canada Pension Plan Investment Board (CPPIB) is a professional investment management organization that invests the funds not needed by the Canada Pension Plan to pay current benefits on behalf of 17mn Canadian contributors and beneficiaries. In order to build a diversified portfolio of CPP assets, the CPPIB invests in public equities, private equities, real estate, inflation-linked bonds, infrastructure and fixed income instruments. Headquartered in Toronto, with offices in London and Hong Kong, the CPPIB is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. At March 31, 2011, the CPP Fund totaled $148.2bn. For more information about CPPIB, please visit www.cppib.ca.