KUALA LUMPUR: The Employees Provident Fund (EPF) has formed a joint venture (JV) with Australia-based logistic property developer Goodman Group to develop RM1.4 billion worth of logistics assets in Malaysia.
EPF deputy CEO Mohamad Nasir Ab Latif said this was the third collaboration with Goodman after the first partnership in Australia in 2012 and subsequently in Germany in 2013.
"We are looking to make Malaysia a world-class logistic hub in the region. This is part of EPF's diversification programme to invest in inflation-linked assets that would benefit the fund's long-term objectives as a retirement fund," said Mohamad Nasir after the EPF-Goodman agreement signing ceremony today.
In the 50:50 venture, Mohamad Nasir said the EPF and Goodman would invest US$100 million (RM359.45 million) each to set up at least eight logistics assets to be built over three years.
Mohamad Nasir said these projects would give the EPF an internal rate of return of 15% on its investment after five to six years.
Goodman has clients like Amazon.com and other multi national companies that could be interested in suitable logistics assets in Malaysia, he said.
On the EPF, Mohamad Nasir said as at December 31, 2014, real estate and infrastructure made up 3.01% of the EPF's total investment assets and contributed RM1.39 billion in investment income.
The RM1.39 billion investment income was an increase of 22.3% from a year earlier.
Goodman executive director Philip Pearce said it was looking for suitable land in the Klang Valley, and Iskandar Malaysia in Johor for the planned logistics properties.
Pearce said the JV was likely to start with its first project in the next three to six months.