La Caisse de dépôt et placement du Québec is teaming up with global investment manager AMP Capital Investors Ltd. to provide more than $657 million in financing to U.S. developer Tillman Infrastructure.
The investment will help finance the building of new telecommunications towers across the U.S., providing new ground for carriers to cover, as well as boosting the country’s overall communications infrastructure. The agreement could eventually reach up to $1.3 billion based on future growth needs.
Currently, Tillman owns and operates a portfolio of cellular towers, in addition to its construction activities.
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“With Tillman’s strong leadership and seasoned experts, along with our partner AMP Capital, we look forward to contributing to Tillman’s great potential. It has a competitive product that delivers coast-to-coast speed and efficiency,” said Marc Cormier, executive vice-president of fixed income at the Caisse, in a press release. “The company will only continue to benefit from a growing demand for data that will drive mobile infrastructure spending and development for years to come.”
Over the next few years, mobile service providers are expected to spend 15 to 20 per cent of their revenue on capital expenditure to meet the growing demand from consumers and to cater to increasing data traffic, according to the press release. As well, merger-and-acquisition activity within the sector is expected to grow.
“We are excited to have found great partners in CDPQ and AMP Capital to fuel the next stage of our aggressive growth plans,” said Suruchi Ahuja, chief financial officer at Tillman. “We are committed to continue to be the carrier-friendly and carrier-preferred infrastructure provider, and a true partner to our customers as they focus on expanding their coverage and capacity across the nation.”
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In other investment news, the Canada Pension Plan Investment Board is forming a joint venture with Boston Properties Inc. to purchase a business park in Santa Monica for about $825 million.
The office, in Santa Monica’s Ocean Park neighbourhood, is part of 47 acres and includes 21 buildings making up about 1.2 million new square feet of rentable property. The CPPIB is investing about $193 million to gain a 45 per cent ownership of the park, while Boston Properties, which will be operating and managing it, is investing more than $236 million.
“We are very pleased to establish a partnership with Boston Properties to acquire Santa Monica Business Park,” said Hilary Spann, managing director, head of Americas and real estate investments at the CPPIB, in a press release. “The investment provides us with immediate scale in the West [Los Angeles] office market with a top-tier owner and operator, and we look forward to growing our relationship in the future.
“Santa Monica consistently sees strong demand, driven by technology and media firms in the area, and the supply constraints make this asset attractive for CPPIB to hold long term.”
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