CBRE multi manager teams up with CIC for deal in Japan

CBRE GMM invests in logistics portfolio alongside Chinese wealth fund

CBRE Global Multi Manager clients have invested in a deal alongside one of the world’s largest sovereign wealth funds.

In a sign of the changing nature of multi-manager co-investing, CBRE GMM took a 16.7% stake in a 15-property Japanese logistics portfolio, with China Investment Corporation and the portfolio’s asset manager, Global Logistic Properties.

CBRE GMM paid GLP $98m for the stake and will spread it between its flagship, open-ended Global Alpha Fund and various global separate accounts. GLP will retain 33.3% and CIC 50%.

Jeremy Plummer, CEO of CBRE GMM, said: “This is not the traditional domain of multi managers, but gives our relatively small pension fund clients access to the kind of deals investors like sovereign wealth funds do.”

With high-yielding income from the Tokyo and Osaka assets and a sub-1% borrowing margin “this investment will produce a 10% cash-on-cash income yield,” Plummer added.

The core-plus Global Alpha Fund targets a 10% return. It was launched in November 2010 and has $300m of commitments, with just over $200m invested in around 12 positions.

M3 Capital Partners’ Hong Kong office advised GLP on the  formation of the partnership and the subsequent admission of CBRE GMM’s clients.

CBRE GMM also runs the Asia Alpha Plus fund, which targets a 15% return but has returned 22% annually. That fund is expected to be fully invested during Q1 2013.

The firm is believed to be fund raising for debut European and US sister funds. Plummer could not comment on fund-raising, but said: “We see opportunity for that strategy outside Asia.”