GIC, Canada Pension Plan Investment Board to buy Korean mall for $350 million

SINGAPORE sovereign wealth fund GIC and Canada Pension Plan Investment Board (CPPIB) have agreed to buy a mall in South Korea for US$263 million (S$350 million).

The two funds will each have a 50 per cent stake in the D-Cube Retail Mall in Seoul after the acquisition from Daesung Industries, the partners said in a joint statement on Monday.

D-Cube "is an income-generating, high-quality retail mall in a prime location" that was completed four years ago, the statement said.

"The D-Cube Retail Mall is a prime retail asset located in a growing and affluent area, and through this investment, we are pleased to gain exposure to one of the largest retail markets in Asia," said Jimmy Phua, managing director and head of CPPIB's Asia real estate investments.

The mall will be CPPIB's first retail investment in South Korea.

The shopping centre is located next to Sindorim Station, a transport hub connecting Seoul with Incheon and other major metropolitan cities near Seoul, it added.

GIC and CPPIB plan to rebrand the mall as Hyundai Department store and bring in Hyundai, one of Korea's top retail operators, to operate it.

"Working alongside GIC and CPPIB, Hyundai will reposition the D-Cube Retail Mall to better serve the Korean retail market's expected steady growth over the long term," the statement said.

Said Loh Wai Keong, managing director and co-head of GIC Real Estate unit for Asia, said, "Our investment in the D-Cube Retail Mall reflects our confidence in the long-term growth of Korean domestic demand and is consistent with our strategy of acquiring high-quality, centrally-located assets with upside potential".

GIC earlier this month announced a plan to invest £1.1 billion (S$2.2 billion) in British mobile phone giants O2 and Three.

GIC said it was teaming up with CPPIB and three other institutional investors to acquire one-third of the two telcos - which are poised for a mega merger - in a deal worth £3.1 billion in total.

The other investors are Limpart Holdings, which is wholly-owned by the Abu Dhabi Investment Authority, Caisse de dépôt et placement du Québec and BTG Pactual of Brazil.

The seller is Hutchison Whampoa, controlled by Hong Kong tycoon Li Ka Shing.