GLOBAL - US private equity firm Blackstone is seeking to sell several properties in Canada worth approximately CAD$900m (€654m) and could attract interest from pension funds.
Blackstone, which has hired CIBC World Markets to lead the deal, is selling 29 Canadian offices buildings in total, located in Calgary, Edmonton, Ottawa and Toronto.
Blackstone built up its Canadian real estate portfolio back in 2005 with a local partner, Slate Properties, which was in charge of operating the assets.
John O'Bryan, vice-chairman of commercial brokerage firm CB Richard Ellis, told IPE: "There is not a better time to sell, as the assets are performing extremely well.
"Blackstone and Slate Properties have invested a lot of capitals in the refurbishment of the buildings since 2005 to attract more tenants."
The deal comes at a time when the Canadian property market is experiencing a high demand for buildings.
O'Bryan said: "The capital market, as well as the flow of capital, is excellent in Canada. The country also remains attractive for US investors, as the interest rates have shrunk significantly over the last year and are still low.
"In that way, the Canadian market is similar to Australia, where interest rates are also at a low level."
Earlier this month, Blackstone acquired the Australian business Valad Property Group in a deal estimated at AUD207m (€149m).
Pension funds, as well as real estate trusts, are seen as potential buyers and could club together to make an offer for the acquisition of the buildings.
"We might see pension funds partner up with other funds," O'Bryan said. "However, this strategy will be implemented not because of a lack of capital, but only if those institutional investors do not wish to operate the assets."
Blackstone had a total of $26.5bn (€19bn) in real estate assets under management as at 31 March.
