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Overseas Investors Target Australian Real Estate Debt

Overseas Investors Target Australian Real Estate Debt

Overseas Investors Target Australian Real Estate Debt?w=400
The Australian commercial real estate debt market is garnering attention from international investors, with the Canada Pension Plan Investment Board (CPP Investments) making significant inroads.
In partnership with Nuveen, a global asset manager, a substantial investment strategy targeting Australian real estate debt has closed its second round.
The total commitment exceeded $650 million, with CPP Investments contributing $300 million through their CPPIB Credit Investments Inc.
arm, accompanied by funds from the Teachers Insurance and Annuity Association of America and Singapore's Temasek.

Nuveen's strategy highlights the appeal of Australian commercial real estate to overseas investors, offering a stable environment, appealing yields, and strong collateral protection, especially amidst global financial uncertainty. This approach will focus on loans to repeat institutional borrowers, adhering to stringent lending criteria, and targeting the most promising assets in rapidly growing sectors like industrial, logistics, and residential real estate, alongside conditional involvement in retail, office, and alternative spaces.

Raymond Chan, Managing Director & Head of APAC Credit at CPP Investments, emphasized the significance of Australia as a market in the Asia-Pacific region, marking this transaction as a pivotal point for their regional credit strategy. Utilizing Nuveen's local expertise and network, this partnership allows CPP Investments to bolster real estate debt opportunities, offering stable yet attractive returns that contribute positively to the CPP Fund's long-term sustainability.

The strategy, steered by Dugald Marr, Head of Debt Australia and New Zealand at Nuveen, leverages a broad spectrum of expertise from Nuveen's established global real estate debt platform. With nearly 40% of the strategy's funds already deployed, priorities remain focused on sectors with strong growth prospects and limited supply, supported by responsible investment criteria such as waste reduction, energy efficiency, climate impact evaluation, and social considerations.

Andrew Kleinig, Head of Australia and the Global Client Group for South East Asia at Nuveen, views the commitment from CPP Investments as a key milestone that allows for deeper strategic alliances with high-caliber investors. This collaboration also underscores Nuveen's strength in crafting region-specific solutions across equity and debt investment platforms, while helping clients navigate market volatility and meet sustainable investment objectives.

Published:Friday, 13th Jun 2025
Source: Paige Estritori

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