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Canada Pension Plan Buys $1B Stake in Portfolio

TORONTO-The locally headquartered Canada Pension Plan Investment Board purchases a 50% stake in an 11-propety portfolio from Oxford Properties Ltd., a subsidiary of the Ontario Municipal Employment Retirement Board.

By Brian K. Miller | Updated on July 12, 2005

TORONTO-The Canada Pension Plan Investment Board recently spent $1 billion (US$829 million) for a 50% stake in an 11-property portfolio of class A buildings across Canada. The seller, Oxford Properties Ltd. a subsidiary of the Ontario Municipal Employment Retirement Board, holds the other 50% and will be the operating partner of the joint venture.The portfolio totals 8.2 million sf and includes properties in prime Downtown locations in Calgary, Edmonton, Montreal, Ottawa, Toronto and Vancouver. The largest properties in the portfolio include Calgary’s Canterra Tower (820,000 sf); Montreal’s Place de la Cathedrale (645,000 sf); Edmonton’s City Centre (1.8 million sf) and Bell Tower (469,000 sf); Toronto’s Royal Bank Plaza (1.5 million sf), WaterPark Place (803,000 sf) and One Financial Place (655,000 sf); and Ottawa’s Constitution Square (712,000 sf). The transaction also includes Vancouver’s Oceanic Plaza (343,000 sf), Guiness Tower (255,000 sf) and Marine Building (173,00 sf).The CPP Investment Board invests the funds not needed by the Canada Pension Plan to pay current pensions. CPP Investment Board chief executive David Denison says the acquisition is part of the board’s plan to diversify its reserve fund. “Real estate offers attractive risk-adjusted returns that are a good match for the inflation-indexed benefits provided by the CPP,” he says in a prepared statement.CB Richard Ellis broker Peter Senst of Toronto represented the Canada Pension Plan in the transaction. The head of CBRE’s Canada operations Blake Hutcheson was not immediately available Tuesday morning for comment. In a prepared statement, CBRE says the sale is the largest ever brokered by CBRE in Canada.

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