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Great White North sets the gold standard for direct investment

Canada’s public pensions led the way for North American direct investment in global real estate, playing roles in some of 2019's largest acquisitions.

Despite efforts by their US counterparts to manage more assets internally, Canada’s public pensions continue to set the standard for direct investment by North American institutions. Investment companies representing the country’s public trusts played a role in each of the top-five North American pension transactions of 2019.

Four investors, accounting for more than $93 billion of real estate allocation, were behind the top-five acquisitions of the year so far. Joint ventures and club deals were the investment vehicles of choice for Canada’s institutions. Some deals were led by managers while others were done in conjunction with operating partners. One transaction saw a pair of Canadian pensions join forces with another institutional investor.

 

20 Tuas South Avenue 14, Singapore 

Buyer: Ivanhoé Cambridge, CPPIB and partners

Seller: China National Chemical Corporation

Price: $429m

What to know:  LOGOS Property Services managed this club deal of investment heavy hitters to buy a Singapore industrial site. Joining Ivanhoé Cambridge and CPPIB are Bouwinvest, the Dutch pension investor, and LaSalle Global Partner Solutions.

 

Shanghai Ocean Tower 

Buyer: QuadReal with Gaw Capital Partners

Seller: ARA Asset Management

Price: $426m

What to know: This 25-story office building is in the heart of Shanghai’s, business and financial center. It is located near the city’s top pedestrian stretch, Nanjing East Road, as well as cultural draws such as the Bund waterfront promenade. QuadReal partnered with private equity real estate firm Gaw Capital Partners, which plans to add value through physical improvements and increased occupancy.

 

Santa Monica Business Park, California 

Buyer:  Canada Pension Plan Investment Board with Boston Properties

Seller: Blackstone

Price: $627 million

What to know: Bought through a JV between CPPIB and Massachusetts-based investment firm Boston Properties, this 47-acre property includes 21 office buildings and was 94 percent leased at the time of the acquisition. Santa Monica is part of the West Los Angeles sub-market, the biggest and fastest growing office market in the metro region.

 

201 Elizabeth Street, Sydney 

Buyer: QuadReal and partners

Sellers: Dexus and Perron Group

Price: $428 million

What to know: A 32-story office tower that overlooks the Sydney Harbor, 201 Elizabeth Street is home to New South Wales state offices and the publishing house HarperCollins. QuadReal, the British Columbia pension investment corporation, partnered with a pair of Australian firms on the deal: Charter Hall, a manager, and Abacus Property, a REIT.

Docks Bruxsel, Brussels 

Buyer: The Alberta Investment Management Corporation and Portus Retail

Seller: Equilis and TPF

Price: $362 million

What to know: The lone retail asset in this year’s top five, Docks Bruxsel is a shopping mall in the northern part of the Belgian capital. Developed by Belgian firms Equilis and TPF, the 600,000-plus-square-foot complex opened in 2016 and is home to high-end brands such as Michael Kors, Pandora and Swarovski.