Canada’s CPPIB Expands Asia Hotel Bets in $329M Korea Deal with BlueCove

Five months after entering Japan’s hospitality sector, the Canada Pension Plan Investment Board has announced plans to invest in South Korean hotels through a KRW 500 billion ($326 million) partnership with Seoul-based BlueCove Investment.

The partnership, 95 percent owned by CPPIB and 5 percent by BlueCove, will first focus on acquiring and repositioning two hotels in popular tourist areas of South Korea’s capital, with the Canadian institution committing up to KRW 119 billion to the pair of projects.

“Korea represents a compelling next step in CPP Investments’ hospitality strategy in the Asia Pacific region, building on our recent hospitality investment in Japan,” Gilles Chow, head of real estate for Asia Pacific at CPPIB, said in a statement. “Korea’s hospitality market is supported by strong domestic demand and growing inbound tourism.”

The Korean commitment marks a further expansion of CPPIB’s shift away from traditional commercial real estate strategies, into higher yielding operational sectors, such as hospitality, the living sector and data centres, with the organisation having purchased a $55 million stake in Australia’s NextDC just over one month ago.

Betting on Hospitality

CPPIB’s partner in the venture, BlueCove Investment is a Seoul-based asset manager founded in 2019 by veterans of IGIS Asset Management and Pinestreet Assets, including president and founder Esby Kim.

“We see strong momentum in Korea’s hospitality market,” said Esby Kim, BlueCove’s CEO. “By bringing together CPP Investments’ global capital and insights and BlueCove’s on-the-ground expertise, we are well positioned to optimize both existing and new hospitality assets across the country.”

BlueCove made headlines acquiring the Grand Hyatt Seoul in 2023, giving it a trophy property which hosts US presidents and other diplomats visiting the Korean capital, and the company also owns the Grand Josun Busan and the Parnass Hotel Jeju. BlueCove has also been active in Korea’s office market, including teaming up with Blackstone in 2024 to buy a Gangnam commercial tower for $86 million. 

Ranked as Canada’s largest pension fund manager, Toronto-based CPPIB had assets under management of C$793.3 billion ($573 billion) as of 31 March, and has been ramping up its hospitality investments.

North Asia Leads

In making its $162 million commitment to SC Capital Partners’ Japan hospitality investment strategy in January, CPPIB said that, “The partnership underscores the consortium’s conviction in Japan’s hospitality sector, underpinned by strong inbound tourism recovery, supportive government initiatives, and resilient domestic demand.”

A newcomer to SC Capital funds, CPPIB and an existing global institutional investor made an initial commitment of up to $330 million to the Singapore fund manager’s ventures, with capacity to increase the total commitment up to $719 million, according to a statement issued at the time. The unnamed institutional investor had invested in the strategy since 2022, SC Capital said.

The Asian initiatives come after CPPIB in 2022 formed a joint venture with Hamilton-Pyramid Europe focused on the European hospitality sector. CPPIB committed Euros 475 million to the joint venture.

According to JLL’s Asia Pacific Capital Tracker report released in April, hotel transaction volumes in the first quarter of the year were up 36% compared to the previous year, “signalling institutional confidence translating into capital deployment.” Transactions in Japan, China and South Korea represented 73 percent of the total volume.

In South Korea, JLL said, transactions centered on 4-5 star business hotels in core locations of Seoul. “Investors are still focused on value-add opportunities such as rebranding vacant-possession assets,” according to the report.

In addition to CPPIB’s investment in NextDC, the fund manager teamed up with Goodman Group just before Christmas for a $9.4 billion European data centre partnership after backing the Aussie industrial specialist’s $2.7 billion Hong Kong data centre venture in July 2025.