Photo byShutterstock.com

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In another mega partnership, APG, Canada Pension Plan InvestmentBoard and ESR Cayman Limited Investments, have entered into a newjoint venture, called ESR-KS II. Its goal is to invest in SouthKorean industrial assets.

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The JV, which has a total equity allocation of $1 billion, isconsidered one of the largest global real estate capital raisingsthis year. It comes on the heels of another high-profilecollaboration by the trio in the area of Korean logistics.

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The JV parties say they hope over time it will double itsinvestment by delivering as much as $2 billion in new developmentprojects, including a best-in-class industrial and warehouselogistics portfolio in Seoul and Busan.

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The two cities are the most lucrative in terms of consumerspending and most densely populated in South Korea at a time whenthe country's e-commerce demand is exploding.

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Initial investments by APG, CPP and ESR in the JV are valued at$350 million, $450 million, and $200 million, respectively. Eachwill hold 35%, 45% and 20%, respectively, of the total issuedshares.

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The partnership marks APG's fourth development collaborationwith ESR, and CPP Investments' third joint partnership with ESR. Itfollows an earlier $1 billion joint venture – which was laterupsized to $1.15 billion – between the three. That venture led tothe development of 17 projects totaling 2.2 million square metersof Gross Floor Area in South Korea.

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All three groups are looking to capture more of the Asian market"to meet the long-term return and sustainability objectives of ourpension fund clients," said Graeme Torre, head of Real Estate, APGAsset Management Asia, in a statement.

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"This will allow us to capture the next wave of growth andopportunity in a sector that even in these uncertain times, isdemonstrating resilience," Torre said.

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APG is the largest pension administrator in the Netherlands withapproximately 3,000 employees. The company provides executiveconsultancy, asset management, pension administration, pensioncommunication, among other services for over 22,000 employers. Ithas offices in Heerlen, Amsterdam, Brussels, New York and HongKong.

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Jimmy Phua, Head of Asia Real Estate at CPP Investments, saidthe JV "deepens our longstanding relationship with ESR and APG …and is key to our growth strategy in the logistics sectorglobally."

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As for ESR's integrated fund management platform, it will beutilized in another capacity at a time when the Asia Pacificlogistics sector is booming.

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"We will continue our strategy to expand … across the region togrow our AUM [Assets Under Management] while delivering solidreturns for our capital partners and stakeholders," said JeffreyShen and Stuart Gibson, Co-founders and Co-CEOs of ESR, in astatement.

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Suzette Parmley

Trenton Correspondent who covers the N.J. Supreme Court, Governor, Legislature. She also contributes to The Legal Intelligencer and law.com. Suzette joined New Jersey Law Journal in Jan. 2019 from the Philadelphia Inquirer where she was a former Trenton Statehouse Correspondent and Business Reporter/Columnist. Awards: 1st Place for 2020 coverage of NJ Supreme Court; 2019 Specialized Writing Category, 5-time winner of the Business Financial Writing Portfolio Award from the New Jersey Press Association. Graduate of the Fels Center of Government/University of Pennsylvania. Email: [email protected] or follow on Twitter: @SuzParmley