IvanhoƩ Cambridge has teamed up with longtime partner and real estate investment manager Hines to buy part of the land where the duo plans to build a 2.9 million square foot office campus in Toronto, the groups said Wednesday.
The partners purchased the land, located at 141 Bay Street, in Torontoās central business district from Metrolinx, Ontarioās transportation agency. IvanhoĆ© Cambridge originally purchased the adjacent land parcel for the project, located at 81 Bay Street, in 2007. Houston-based Hines joined the project as its development manager in 2013 and became an equal joint venture equity partner this year.
Spokesmen for IvanhoƩ Cambridge and Hines declined to disclose the land purchase cost or the anticipated price tag for the entire development.
The project, called Bay Park Centre, will encompass two 49-story office towers connected by a one-acre elevated park, according to Wednesdayās statement. Amenities will include fitness and bicycle parking facilities, restaurants and interior parking. Bay Park Centre will also include a new bus terminal currently located at 141 Bay Street that will be relocated to 81 Bay Street.
Jonathan Pearce, IvanhoĆ© Cambridgeās Toronto senior vice president of office leasing, said the build-to-core development represented a milestone for the Canadian investor. In a tight market with Class A office vacancies below 5 percent, he said the project would deliver scale to the central business district, which has not seen substantial new construction in 25 years. Pearce said IvanhoĆ© Cambridge does not have any comparable ground-up development projects currently elsewhere in Canada.
āThis is by far and away our most substantial investment in Toronto. Itās a market weāve been trying to do something in for a number of years,ā he told PERE. āWe wanted to build a signature asset and leave an impression on the Toronto skyline.ā
Construction on the project will begin this spring, with one tower projected to be completed in 2020 and the other in 2023.
Canadian bank CIBC will be Bay Park Centreās anchor tenant, leasing 1.8 million square feet of office space for what will be the companyās new headquarters. CIBC also has naming rights to the development.
Hines and IvanhoƩ Cambridge have worked on projects in the US, Canada and Europe, according to previous statements.
IvanhoĆ© Cambridge is the real estate arm of Canadian pension plan Caisse de dĆ©pĆ“t et placement du QuĆ©bec. It managed about C$56 billion ($42 billion; ā¬39.8 billion) in real estate as of December 31, according to Wednesdayās statement.
Hines has $96.5 billion in assets under management.