Singapore's GIC taps Canadian group to acquire US student housing

GIC Pte Ltd
The logo for Singapore sovereign wealth fund GIC Pte Ltd, is seen on a building in Singapore Reuters

The joint venture amongst Singapore sovereign wealth fund GIC, Canada Pension Plan Investment Board (CPPIB), and The Scion Group acquired a student housing portfolio in the United States for around US$1.1 billion.

The student housing portfolio is composed of 24 assets across 20 university campus markets and is comprised of over 13,000 beds. The acquisition includes the purchase of 22 properties and the recapitalisation of two communities formerly handled by Scion-affiliated private syndications.

GIC Real Estate chief investment officer Lee Kok Sun said the Singapore sovereign wealth fund and CPPIB each own 45 percent stake in the portfolio. The remaining 10 percent is given to Scion.

"We remain confident in the student housing sector, and in our partnership with Scion and CPPIB which has enabled us to scale-up quickly our US student housing portfolio," Lee told the press, noting that GIC will continue to collaborate with its partners to expand its presence in the US student housing market.

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To recall, the three-member JV has already completed over US$4 billion investments since January 2017. With this new acquisition, the JV now has in its arsenal 73 student housing communities with more than 46,000 beds in 52 markets.

Scion president Robert Bronstein said this transaction is particularly strategic, reinforcing the presence of the JV in certain markets.

"This is consistent with our strategy to concentrate our investments in targeted markets by owning multiple properties with diverse product types and rental price point options," Bronstein noted in a statement.

Meanwhile, CPPIB real estate investments head Hillary Span said this investment opportunity the JV unlocked will enhance the group's scale in the US student housing sector.

"We believe the secular strength of the US student housing sector will continue to deliver attractive risk-adjusted returns for the CPP Fund, and we look forward to continue growing the joint venture with GIC and Scion," stated.

This article was first published on January 5, 2018