- What Manulife Investment Management is offloading 150 Slater Street for $141m
- Why Regional Group is acquiring the asset at a mid-8% capitalization rate
- What next The CBRE-led deal will close in June
A Class-AA office tower in downtown Ottawa is expected to trade for $141m, Green Street News can reveal.
Regional Group is in talks to acquire 150 Slater Street from Manulife Investment Management. The valuation represents a first-year capitalization rate in the mid-8% range.
The deal, brokered by CBRE’s national investment team, is expected to close at the end of Q2. The 477,000 sq ft building hit the block in September with guidance of $143m, or $300/sq ft. Pricing landed just shy of that, at $295/sq ft.
The impending sale of 150 Slater Street will be the first office transaction above $100m Ottawa has seen in over a year and the fourth-largest office trade ever reported in the city, according to Green Street’s Sales Comps Database. The last Ottawa office deal to cross the $100m mark was 181 Queen Street, which Morguard sold to Public Services and Procurement Canada for $125.3m in February 2024.
Larger deals include 160 Elgin Street, which H&R REIT sold to Sarees Investments and Groupe Mach for $277m in 2023, and the Place de Ville office complex at 330 Queen Street, which Alberta Investment Management, Brookfield Properties and Canada Pension Plan Investment Board sold to Crestpoint Real Estate Investments and Crown Realty Partners for $350m in 2021.
The high-water mark for an office sale in Ottawa belongs to the Constitution Square complex, at 340, 350 and 360 Albert Street, which CPPIB and Oxford sold to Greystone Managed Investments, Canderel and Canstone Realty Advisors for $480m in 2017.
150 Slater Street was purpose-built in 2011 to serve as Export Development Canada’s head office. It’s 100% occupied, with EDC leasing 98% of the space with a remaining term of 6.8 years. Ground-level retail is tenanted by Toro Eats & Treats and Laurier Computers. There are 215 underground parking stalls and a fitness centre. It’s certified LEED gold.
The building is at the intersection of O’Connor Street and Slater Street in Ottawa’s central business district. It’s within a kilometre of Parliament Hill, Ottawa City Hall and the Québec border. Ottawa International Airport is 10 km away.
The office vacancy rate in Ottawa’s CBD was 14% and 12.8% among Class-A assets in Q1, CBRE said in a recent report. The CBD had nearly 21,000 sq ft of negative net absorption for the quarter, and no new supply is under construction.
The overall office vacancy rate in downtown Ottawa was 15.7% in Q1, the second-lowest among major Canadian cities. Only Vancouver had a tighter office market, at 10.7%.
Regional Group is a real estate investment, development and management firm focused on the Ottawa-Gatineau region. Sender Gordon is president and chief executive.
Headquartered in Toronto, Manulife is the asset management arm of Manulife Financial. Paul Lorentz is president and chief executive of global wealth and asset management.
