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A joint venture between CPP Investments, Dream Unlimited Corp. (DRM-T) and Dream Industrial REIT (DIR-UN-T) has acquired a 2.1-million-square-foot industrial portfolio in the Greater Toronto Area for $585.8 million.
The portfolio is comprised of five newly developed mid- and large-bay logistics assets totalling 2.1 million square feet of gross leasable area (GLA), the partners announced on Monday evening. Four of the properties are in Oshawa and the fifth is located in Brampton.
In December of last year, Dream and CPP Investments announced they were joining forces on a $3-billion venture to acquire last-mile logistics properties.
“This acquisition builds on our conviction in the long-term fundamentals of Canada’s industrial sector and adds a high-quality portfolio of well-located logistics assets to the joint venture,” CPP managing director, head of real estate, Sophie van Oosterom, said in the announcement.
“Together with Dream, we continue to identify attractive opportunities to scale the portfolio and generate long-term value for the CPP Fund.”
The GTA portfolio
The five assets acquired were all built between 2020 and 2024 and feature 36- to 40-foot clear heights, ample trailer parking and a loading ratio of one door per 8,000 square feet, positioning them to accommodate both mid- and large-bay occupiers, according to the announcement.
The properties are fully leased to a "roster of strong national and international companies, generating stable in-place income, with the opportunity to drive value through executing on embedded mark-to-market rental growth potential," the partners said.
The properties are located at:
- 883 Thornton Road South, Oshawa;
- 1121 Thornton Road South, Oshawa;
- 1565 Thornton Road North, Oshawa;
- 1147 Thornton Road South, Oshawa; and
- 100 Ace Drive, Brampton.
“This acquisition adds a best-in-class logistics portfolio to our platform in one of North America's strongest industrial markets," Dream Industrial REIT chief investment officer Bruce Traversy said.
"The transaction aligns with Dream Industrial REIT's strategy of investing in high-quality industrial real estate that offers stable cash flows and opportunities for value creation through active asset management. We see a strong pipeline of further opportunities across Canada and look forward to continuing to build our partnership with CPP Investments."
The joint venture was initially seeded with an $805-million portfolio of 12 properties from Dream Industrial.
As of this transaction, the JV, in which CPP Investments holds a 90 per cent stake, has deployed over $1.4 billion of capital in Canadian industrial properties, nearly half of its original $3-billion investment target, the announcement said.
About CPP, Dream Asset Management and Dream Industrial REIT
CPP Investments is a professional investment management organization that manages the Canada Pension Plan Fund. CPP invests in public equities, private equities, real estate, infrastructure, fixed income and alternative strategies around the world. At June 30, the fund totalled $863.6 billion.
Dream Asset Management Corporation is the institutional asset management arm of Dream providing investment and asset management services to its publicly listed trusts and institutional partners. As at June 30, Dream manages $28 billion of assets across listed entities, private funds and private partnerships in North America and Europe.
Dream Industrial REIT is an owner, manager and operator of a global portfolio of well-located, diversified industrial properties. As at June 30, the REIT has an interest in and manages a portfolio which comprises 348 industrial assets (565 buildings) totalling approximately 75.7 million square feet of gross leasable area in key markets across Canada, Europe, and the U.S.
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