NZ Super Fund seeks to capitalise on growing demand for data with USD 115m investment

The NZ Super Fund is a NZD41 billion global investment fund established by the NZ government to help pre-fund universal pensions. It is now increasing its investment in data, with the aim of maintaining its 10 per cent return on investment. The investment is being made alongside CIM, a community focused real estate and infrastructure owner. The details are below.

The NZ Super Fund (the "Fund") is seeking to capitalise on demand for digital infrastructure, underpinned by the growth in data, by investing up to US$115 million in North American data centres.

The investment is being made alongside vehicles managed by CIM Group, a North American real estate and infrastructure owner and operator. The investment includes potential access to certain of CIM's pipeline of future data centre transactions and its existing portfolio of six data centres at various stages of development and operations. The existing portfolio is owned through one or more joint ventures with CIM Group's managed vehicles.

NZ Super Fund Head of External Investments and Partnerships Del Hart said: "Data centres offer strong infrastructure-like returns underpinned by exponential growth in digital data. We are seeing increasing customer demand for offsite data centres as enterprises either shift data management to third party providers or move to the cloud. Furthermore, by 2021, data volumes are expected to be nearly three times 2016 levels."

The NZ Super Fund's investment with CIM is in the provision and leasing of data centre facilities and infrastructure and not in data centre operation. The data centres are located across North America in San Francisco, California; Toronto, Ontario; Orangeburg, New York; Chicago, Illinois; and Cheyenne, Wyoming.

"As the market demand for flexible datacenter space increases, we believe that our portfolio of data center properties located in key metro markets in North America including New York, Toronto, Chicago, and San Francisco serves both existing technology and enterprise tenants as well as new customers, and provides access to a dense network of fiber providers and trans-continental connectivity to support their evolving business needs," said Avi Shemesh, Co-founder and Principal of CIM.

The Fund will co-invest alongside CIM Group's managed vehicles. The investment will be operated by CIM on behalf of the NZ Super Fund.

The Fund also has a 39% investment in New Zealand information technology company Datacom, which has a network of data centres in New Zealand and Australia.

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Thursday, 14 November 2019