LOS ANGELES—There is no doubt that Los Angeles has seen a huge influx of foreign capital, and while much of it is from Asia, one of our neighbors to the north is making a particular splash in the market. Vancouver-based Onni Group has made several purchases here in the last six months alone, and recently called Los Angeles its US market of choice in a GlobeSt.com interview. To find out more about the firm's interest in the Los Angeles market and its plans to continue to invest here, we sat down with Daniel Bell, an acquisitions executive at Onni Group, for an exclusive interview.
GlobeSt.com: What has attracted you to the LA market?
We entered the LA market in 2010 as part of an overall strategy to grow our business in the US. From our perspective, the financial turmoil of 2008-2009 created an unprecedented opportunity for us to invest in the US real estate market. In addition, the Canadian dollar was trading around par to the US dollar at the time. We identified certain cities as ones that we thought would recover quickly and LA was one of the ones at the top of the list.
Aside from the compelling macro-level reasons, we saw and continue to see numerous value opportunities that are not necessarily readily available in other major markets. The size of the LA real estate market also allows us to place a significant amount of capital, obtain critical mass and substantially grow our business.
GlobeSt.com: You have made several large purchases this year in different submarkets of LA. Can we expect you to continue to grow your portfolio here? Are you looking to place a certain amount of capital or grow to a certain portfolio size?
Bell: Our intention is to continue to invest and grow the portfolio. There is no identified amount of capital we are looking to invest or portfolio size that we're aiming for—we will continue to be active as long as we can continue to find opportunities to invest in that meet our return requirements.
GlobeSt.com: You have also been investing across property types. What are you looking for in terms of an investment. Location seems to be the most important characteristic for you. Is that true?
Bell: Location is important, but we are more focused on identifying opportunities that present a compelling value story, opportunities where we can bring our balance sheet or expertise to bear—construction, property management, development, etc. In Canada, we invest and develop fairly heavily in all asset classes: office, industrial, retail, multifamily, hotel, etc., so we are comfortable in those spaces.
GlobeSt.com: We have seen a lot of foreign investment in LA, but mainly from Asian money. As a Canadian investor, what is attractive about placing money in the US.? What other markets have you been active in?
Bell: Vancouver (and Canada generally) is a very small, competitive and tight market and finding opportunities that allow us to grow and diversify our business required us to look at other, larger markets. The US presents the largest, most liquid real estate market in the world and it allows us to continually place capital. We have also invested fairly heavily in Phoenix, Seattle and Chicago and continue to look at other markets to invest in.
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Kelsi Maree Borland
