- What Oxford is buying out CPP Investments’ stake in seven office buildings
- Why The deal values the portfolio at $1.5bn
- What next It’s the most significant office portfolio trade since 2022 in Canada
Oxford Properties is buying out CPP Investments’ stake in seven office buildings co-owned by the duo for $730m.
The deal values the 4m sq ft portfolio at $1.5bn. Ownership of the assets — three in Calgary and four in Vancouver — had been equally split.
Included in the sale are Calgary’s Eau Claire Tower, at 600 3 Avenue SW; the two-tower Centennial Place, at 530 3 Avenue SW and 250 5 Street SW; and 400 3 Avenue SW.
Oxford now has 100% ownership of Vancouver’s the Stack, at 1133 Melville Street; Guinness Tower, at 1055 West Hastings Street; Marine Building, at 355 Burrard Street; and MNP Tower, at 1021 West Hastings Street.
The assets have long-term weighted average lease terms and outperform the downtown Calgary and Vancouver office markets, according to Oxford. Five of the seven were completed after 2010.
The deal marks one of the largest portfolio sales of the year, coming in behind Forum Asset Management’s acquisition of Alignvest Student Housing REIT. The $1.7bn deal for 17 properties closed in January.
The last time a Canadian office portfolio traded above the billion-dollar mark was in 2022, when Groupe Mach acquired 42 retail and office properties from Cominar Real Estate Investment Trust for approximately $1.5bn.
“Oxford has been a net seller of office for over a decade to achieve portfolio diversification. We believe now is an opportune time to rotate capital back into this asset class, and this portfolio ticks all the right boxes,” Tyler Seaman, executive vice president, Canada, at Oxford Properties, said.
“As the asset and property manager of this portfolio, this transaction represents a compelling opportunity for us to further invest in markets that we not only understand intimately, but in buildings where our teams have built great relationships with our customers and where we consistently use this advantage to outperform the market.”
In April, CPP Investments put its Toronto headquarters at 1 Queen Street East on the block for $125.9m. Late last year, the firm sold its stake in 2 Queen Street East in a deal that valued the Toronto office building at $215m. Prior to that, CPP Investments and Oxford offloaded Galeries de la Capitale in Québec City for $325m.
Oxford is a commercial real estate investment, development and property management firm wholly owned by the Ontario Municipal Employees Retirement System. Daniel Fournier is executive chair of the Toronto-based firm. OMERS has $138.2bn in net assets.
Headquartered in Toronto, CPP Investments is a Crown corporation that invests on behalf of the Canada Pension Plan. John Graham is president and chief executive. The investment board has $646.8bn in net assets.
Correction: This article was updated to correct the ownership of 2 Queen Street East
