CBRE expands infra focus with Caledon acquisition

The real estate investor said it was increasing its focus on real assets in general, purchasing a majority stake in a company specialising in infrastructure investments.

American real estate firm CBRE Group has purchased a majority stake in Caledon Capital Management in a move to broaden its investment focus to include more infrastructure.

The acquisition, for an undisclosed amount, is part of a move to a wider focus on real assets, CBRE stated. The Los Angeles-based firm said Caledon Capital will operate as a separate business unit in CBRE's investment subsidiary CBRE Global Investors, which manages $86.5 billion.

Toronto-based Caledon Capital specialises in private infrastructure and private equity, with $7 billion of assets under management. Its 30-person team, which CBRE said would remain in place, has invested in a range of global infrastructure projects through direct and co-investments, secondaries and primary funds.

Its portfolio includes a US renewables platform, European pipeline and storage facilities and a gas transmission and distribution utility in New Zealand.

“Investors are increasing their allocations to alternative investments, including real assets,” CBRE Global Investors chief executive Riston Ferguson said. “Caledon's market-leading investment solutions are a logical extension to our existing suite of real estate and infrastructure investment solutions.”

The move comes as fund managers and institutional investors consolidate their real estate and infrastructure portfolios into single real assets categories because of their similar investment characteristics. In April, The California Public Employees' Retirement System announced it would merge the two asset classes, as well as forestland investments, into a single real assets portfolio.