A portfolio of European warehouses brought about the formation of a new joint venture. Britain's Segro and one of Canada's largest retirement income funds were joint due to industrial real estate's soaring profits.
The growing online shopping industry was also assumed to bring more returns to the sector considering its need for warehouses for distribution.
Euro 303 million or US$394 million would be contributed by Canada's Public Sector Pension Investment Board. The latest global investor currently manages the police and army's pension reserve which was about C$64.5 billion or $61.5 billion. PSP would pay for its share in the business enterprise using the retirement funds.
"It (industrial property) is a perfect asset class in this world of falling bond yields because you have higher yields and letting momentum is actually picking up," J.P. Morgan analyst, Harm Meijer, said.
PSP Investments, together with Segro, intend to grow the portfolio. No less than Euro 2 billion was their target and they planned to achieve the goal by new expansions and purchases.
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