Chicago-based Bridge Industrial has landed a large institutional partner to help fund its next wave of warehouse investments.

The Toronto-based Canada Pension Plan Investment Board and Bridge have formed a $789M joint venture to purchase industrial properties, with CPP holding a 95% stake and privately owned Bridge chipping in the remaining 5% share of the equity.

The partnership will focus on acquisitions but will also look into new development opportunities. The duo's strategy is to target retailer demand for faster shipping times among dwindling warehouse space, according to a release.

This marks the second collaboration between the two. They formed a $1.1B joint venture in 2021 for industrial development, targeting Miami and Los Angeles. The joint venture's inaugural project was in the Miami-Dade County city of Doral, where Bridge developed six warehouses spanning 2.6M SF with CPP's backing.

“We are excited to broaden our successful collaboration with CPP Investments as we work together to capitalize on outstanding opportunities to acquire premium industrial space in the U.S.,” Steve Poulos, founder and CEO of Bridge Industrial, said in a statement.

CPP is returning to invest in the industrial sector a week after announcing it sold its 45% stake in the $6B logistics fund it formed in 2012 with Goodman North American Partnership, netting $2.2B.

The pension manager for CPP announced in May that it planned to reduce its real estate exposure to 8% in 2024, down from 12% five years prior, after taking a 5% loss on its CRE portfolio in 2023.

“The industrial sector's favorable market dynamics position this joint venture well to deliver strong returns for the CPP Fund,” Sophie van Oosterom, managing director and head of real estate at CPP Investments, said in a statement. “Bridge and CPP Investments have a shared vision of the value and opportunity in the sector, and we’re pleased to expand our partnership.”

Industrial properties are still a favored investment target — GCM Grosvenor and Standard Real Estate Investments announced a $600M industrial and workforce housing fund this month — even as the market for warehouses has cooled after rapid growth during the pandemic.

More than 425M SF of industrial space was completed in 2024, with 78% of these projects built speculatively, according to a fourth-quarter report from Cushman & Wakefield. While vacancy rose to 6.7%, the increase was the smallest quarterly increase since the market began to slow down in late 2022, according to Cushman.