* Teams up with CIC, GIC, Canada fund
* Set to buy $1.4 bln Brazil assets
* Follows Australian rival Goodman in entering Brazil
* Shares up 55 pct this year, second best index performer
By Charmian Kok and Anshuman Daga
SINGAPORE, Nov 14 Singapore warehouse operator
Global Logistic Properties Ltd is teaming up with
large institutional investors to buy $1.4 billion of assets in
Brazil as it looks to sustain its strong pace of growth.
Developers such as GLP, one of the world's largest warehouse
operators, are looking to tap robust demand for high-quality
warehouses in Brazil. Last week, Australian competitor Goodman
Group also announced plans to develop logistic assets
in Brazil through a joint venture.
GLP, which owns warehouses in Japan and China, will form
joint ventures with the Canada Pension Plan Investment Board
(CPPIB), China Investment Corp and Government of
Singapore Investment Corp to buy 40 properties worth
around $1.4 billion in the Latin American country.
"Brazil is the next hot spot," said Kian Lin Ong, an analyst
at Maybank Kim Eng. "Investors are always looking for growth.
Japan is more or less stable and in China I guess the growth is
moderating. So, Brazil is a logical choice."
GLP, 50.6 percent-owned by sovereign wealth fund GIC, is the
second-best performing stock in Singapore with a 55 percent
surge this year in a broader market up 14 percent.
Taking advantage of the strong share price performance, GLP
said it would largely fund its initial equity commitment of $334
million through a share placement.
CPPIB, one of the world's top pension funds and dealmakers,
said its total commitment will be $343 million, of which $200
million will be funded at closing.
"This investment will significantly expand our logistics
portfolio in Brazil and represents a rare opportunity to invest
in a sizeable portfolio of high quality development and
stabilized logistics assets," Peter Ballon, CPPIB's head of real
estate investments in the Americas, said in a statement.
The Canadian pension fund manager has been actively scouting
deals in this sector. In August, CPPIB and Australia's Goodman
Group formed a new joint venture to target investments in U.S.
STRONG TRACK RECORD
Analysts said GLP's strong track record of project
implementation meant the company was in a favourable position to
exploit Brazil's rising infrastructure spending and logistics
facilities that are far from modern.
Around 88 percent of the Brazil portfolio will be located in
Rio De Janeiro and Sao Paolo, GLP's chief executive officer Ming
Z. Mei said on a conference call, adding the portfolio was
expected to generate 18-19 percent returns before fees and other
GLP said its $2.6 billion Japan real estate investment trust
received approval from Tokyo Stock Exchange to list Dec. 21. The
Singapore firm expects to raise net cash proceeds of $1.3
billion that it will use mainly for projects in China and Japan.
GLP told Reuters in an interview last month the firm was
keen to grow at a rapid pace in China to support a boom in
(Additional reporting by Euan Rocha in Toronto
Editing by Muralikumar Anantharaman and Bernadette Baum)