NPS, Hines form $1.5bn build-to-core venture

NPS, Hines form $1.5bn JV for build-to-core development strategy

The National Pension Service of Korea (NPS) and Hines have formed a new build-to-core venture to capture evolving demands of modern spaces across real estate.

The $1.5 billion USD equity joint venture will pursue urban infill developments across a broad span of sectors including mixed-use, residential, office and logistics in high-barrier-to-entry markets globally.

Hines said twenty percent of the venture is currently committed to projects in North America and Asia-Pacific. The venture targets a build-to-core strategy to create a portfolio of prime assets resilient to market uncertainties.

”NPS and Hines believe that long-term investments in proven locations, supported by innovation and new technology, will capture sustained demand and create outsized value – which form the strategic investment focus of the partnership” said in the statement.

In addition to being a co-investor in the partnership with NPS, Hines will be responsible for sourcing, designing and executing development opportunities globally, which will leverage Hines’ relationship networks formed across the firm’s presence in 225 cities worldwide.

NPS and Hines have previously partnered on investments across product types and strategies in Europe and North America, with landmark collaborations including Sony Center in Berlin, One Vanderbilt and One Madison in New York.

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“We believe there are significant opportunities to invest in the highest-quality, bulletproof assets that will provide long-term value to NPS stakeholders,” commented Mr. Hyo-Joon Ahn, Chief Investment Officer of the National Pension Service of Korea. “The current economic climate, shaped by global responses to the pandemic, has impacted all sectors of commercial real estate. This venture has committed to a long-term strategy capitalizing on the transformation of living environments, consumer behavior and space-use patterns combined with latest technology in real estate development.”

Hines Chairman and CEO Jeffrey C. Hines said, “Like us, NPS values permanence, quality and innovation in core real estate. We see this new mandate as a natural extension of our longstanding relationship and a further opportunity to apply our real estate investments and execution skillsets to create differentiated multi-sector projects that enhance communities.”

“We are pleased with the elevated level of trust extended to us by our valued partners like NPS over the past few years as we’ve leaned toward executing a stronger investment strategy even more focused on our investors’ needs,” added Hines Global Chief Investment Officer David Steinbach. “Discretionary capital programs allow us to seize on the best opportunities, apply our skillsets, and focus on being the real estate partner of choice globally.”

National Pension Service of Korea (NPS) is one of the largest pension funds in the world with approximately $672 billion USD in assets as of September 30, 2020. 

Hines is a privately owned global real estate investment firm founded in 1957 with a presence in 225 cities in 25 countries.