Greystar Real Estate Partners will join a partnership, between Canada Pension Plan Investment Board (CPP Investments) and Cyrela Brazil Realty (Cyrela), to develop, own and operate purpose-built multifamily rental housing in São Paulo.
”This milestone marks Greystar’s entry into the burgeoning Brazilian rental housing market, and a further step in its continued expansion in South America,” said in a statement.
The partnership was announced by CPP Investments and Cyrela in November 2019. Together, the joint venture partners plans to develop a portfolio of rental housing assets across São Paulo’s most desirable, walkable and well-connected neighborhoods.
The joint venture continues to target an investment of up to R$1 billion in combined equity. CPP Investments will maintain majority interest in the joint venture, Cyrela will also own a significant interest and Greystar will acquire an ownership interest through the expansion of the partnership.
”Four development projects located on premium sites in São Paulo were initially identified as assets to seed the joint venture, with three already secured by the platform. This gives CPP Investments, Greystar and Cyrela’s partnership immediate scale in the market and accounts for approximately 40% of the joint venture’s target equity allocation,” said in the statement.
Greystar will manage the properties acquired through the joint venture along with contributing to the design process, with Cyrela developing and building the assets.
“São Paulo is one of the most dynamic and densely populated markets in the world with a significant institutional investor presence that is attracted to the multifamily asset class because of its relative stability, compelling risk-return profile, and demographic tailwinds. We see tremendous opportunity in Brazil, where the existing for-rent housing options lack the efficiency and sense of community that are hallmarks of Greystar,” said Bob Faith, Founder, Chairman, and CEO of Greystar.
“CPP Investments sees increasing demand in the rental multifamily sector in Brazil, which will particularly benefit developers of modern, high-quality residential space,” said Hilary Spann, Managing Director, Head of Real Estate Americas, CPP Investments. “We are pleased to join our partners Cyrela and Greystar in building a best-in-class portfolio in Brazil.”