REAL ESTATE - Canada’s largest pension fund last week paid CA$430m (€298m) for a landmark London office building in an expression of optimism for a market it described as “booming”.

Société immobilière Trans-Québec (SITQ), a real estate offshoot of pension funds led by €85bn teachers’ pension fund Caisse de depot et placement du Quebec (CDP), said it was “satisfied” with the price it paid given the “flexibility and quality” of the development and its likely re-sale value.

SITQ spokesman Jacques André Chartrand said: “We’re sure that the London market is really booming. The buildings are there. The trends are there. It’s profond.”

He added: “We’re optimistic for the market and we’re optimistic for this building. Our investment strategy is to add value to our acquisitions – though how we’ll invest in this building I don’t know yet.”

He would not comment on the likely yield.

The acquired building forms part of an Arup-designed development completed in 1991. It is leased to the UK government until 2021.

CDP, with one of the world’s 10 largest real estate portfolios, owns 240 properties in seven countries. Its European acquisition drive, initiated last year, has seen it enter the German market, reinforce its presence in Central European markets, and focus region-wide on shopping centres.

The fund’s UK assets include a 39% stake in the Gresham Property Partners Fund co-owned by the British Airways Pension Trustees.