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The world's tallest freestanding towers, the Petronas Twin Towers, rise over the Malaysian city of Kuala Lumpur before sunrise in this file photo.BOB STRONG/Reuters

The Canada Pension Plan Investment Board is venturing into the Malaysian real estate business for the first time.

The CPPIB has purchased a 49 per cent stake worth about $170-million in a joint venture to invest in a mixed-use development in the capital of Kuala Lumpur with Malaysia's Pavilion Group.

They will develop Pavilion Damansara Heights, a project integrating corporate towers, luxury residences and a retail galleria in one of the most affluent sections of Kuala Lumpur less than 10 kilometres from the Petronas Twin Towers.

Jimmy Phua, the managing director of CPPIB's real estate investments in Asia, says the joint venture is a "great opportunity to work with a smart partner in a high-quality real estate asset that will provide attractive risk-adjusted returns over the long term."

The CPPIB invests funds not needed by the Canada Pension Plan to pay current benefits.

As of the end of June, the fund totalled $268.6-billion.