CANADA - British Columbia Investment Management Corporation (bcIMC), the investment arm of several Canadian public-sector pension funds, is to acquire a hotel Reit for CA$1.2bn (€800m) in cash.
The CA$85bn fund will acquire the Canadian Hotel Income Properties Real Estate Investment Trust (CHIP-REIT) for CA$19 per unit – at a 34% premium over its closing price at the end of July.
Gwen-Ann Chittenden, bcIMC’s corporate initiatives manager, declined to comment on why the fund had paid such a high price for the REIT. However, she cited as in the firm’s favour a strong management team and a robust strategy.
"We invest in companies that have potential for long-term, strong returns at low risk," she said.
CHIP-REIT’s board unanimously backed the decision to sell and BcIMC – which holds both direct and indirect real estate investments – expects the deal to close in Q4.
The fund invests on behalf of pension funds (76.6%), government bodies (15.5%), sinking funds (4.9%), public trusts (2.3%) and government funds (0.7%).
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