Major Transactions and Cap Rates – Where are the Trends Heading

Major Transactions and Cap Rates – Where are the Trends Heading

Atlantic Investment Market
Overview: Major Transactions and
Cap Rates – Where are the Trends
Heading
June 9th, 2015
Moderator:
Joanne Slaney, Director & General Manager, Research
Valuation & Advisory, Altus Group
Panel:
Nurit Altman, Partner, Brookfield Financial
Chris Carter, Associate Vice President, National Investment
Team, CBRE Limited
Bill MacAvoy, Managing Director, Cushman & Wakefield
Atlantic
Greg Taylor, Vice President, Managing Director, Investment
Sales, Collier International
2
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4
5
Major Transactions
Retail Market
SALE – Sobeys Portfolio, ON, NS, NB, NL
VENDOR
PURCHASER
DATE
Sobeys
Econo-malls
February, 2015
SALE PRICE
$89,000,000
PORTFOLIO
24 freestanding stores &
strips
SIZE (SQ.FT.)
OCR
PRICE PER SQ.FT.
616,530 sq.f.t
6.9% (7.5% for Atlantic
Canada)
$105
SALE – DEW Corp Lands, St. John’s NL
VENDOR
JOINT VENTURE
PARTNER
DATE
SALE PRICE
BUILDING TYPE
LAND AREA
PROPOSED
DEVELOPMENT
DEW Corp.
Plaza Retail REIT
Pending
NA
Retail Development Land
100 acres +
700,000 SQ.FT.,
unenclosed, regional
shopping centre
Major Transactions
Office Market
SALE – 50 Innovation Drive, Bedford, NS
VENDOR
PURCHASER
DATE
SALE PRICE
BUILDING TYPE
SIZE (SQ.FT.)
OCR
PRICE PER SQ.FT.
Blackberry
Armour Group
May 2014
$26,545,000
Office
156,444
Not applicable
$170
SALE – 551 King Street, Fredericton, NB
VENDOR
PURCHASER
515341 NB Ltd
Starlight Investments
Limited
DATE
August 2013
SALE PRICE
$17,000,000
BUILDING TYPE
Office
SIZE (SQ.FT.)
84,743
OCR
7.25%
PRICE PER SQ.FT.
$200.60
Major Transactions
Industrial Market
SALE – Southwest Industrial Portfolio, NS
VENDOR
PURCHASER
DATE
SALE PRICE
BUILDING TYPE
SIZE (SQ.FT.)
OCR
PRICE PER SQ.FT.
Southwest Properties Ltd
Standard Life Assurance
June 2014
$25,300,000
Industrial
313,151
8.6%
$81
SALE – Moncton Industrial Portfolio, NB
VENDOR
PURCHASER
DATE
SALE PRICE
BUILDING TYPE
SIZE (SQ.FT.)
OCR
PRICE PER SQ.FT.
NBIMC Realty Corp
Boulevard Industrial
REIT
March 2014
$15,000,000
Industrial
236,000
9.1%
$64
Major Transactions
Multi Residential Market
SALE – The Huntington, 58 Holtwood Court, Dartmouth, NS
VENDOR
PURCHASER
DATE
SALE PRICE
BUILDING TYPE
# OF UNITS
OCR
PRICE PER UNIT
Blue Iron Developments
Centurion REIT
December 2014
$23,666,007
Apartments
114
5.5%
$207,597
SALE – Kelly’s Brook Apartments, St. John’s, NL
VENDOR
PURCHASER
DATE
SALE PRICE
BUILDING TYPE
# OF UNITS
OCR
PRICE PER UNIT
Nuport Holdings Limited
NPR GP Inc.
March 20, 2015
$11,600,000 (adjusted
development site
removed)
Apartments
139
7.08%
$83,453
Major Pending Transaction – Fortis Commercial Portfolio
Commercial Assets
Location
% of
ownership
Type
Sq. Ft.
Major Tenant
1
Kings Place
Fredericton, NB
100%
Office
292,986 Province of NB, Canadian Schedule Bank
2
Blue Cross Building
Moncton, NB
100%
Office
325,735 Medavie Inc, Moncton Library, ACOA
3
Brunswick Square
Saint John, NB
100%
Mixed Use
Total New Brunswick Assets
4
Maritime Centre
521,464 Bell Aliant Province of NS, Gov't of Canada
1,140,185
Halifax, NS
100%
Office
Total Nova Scotia Assets
567,925 Bell Aliant, Irving Oil, Saleforce.com
567,925
5
Fortis Building
St. John's, NL
100%
Office
82,648 Curtis Dawe, Fortis
6
Water Street Properties
St. John's, NL
100%
Office
73,496 Downtown Development Commission
7
Fort William Building
St. John's, NL
100%
Office
8
Fortis Tower
Corner Brook, NL
100%
Office
9
Fortis Place
St. John's, NL
10%
Office
143,516 Deloitte, Fortis Inc, Schlumberger Canada Limited
10
Cabot Place
St. John's, NL
10%
Office
Hibernia Management, Stewart McKelvey, BMO Nesbitt
137,324 Burns
11
TD Place
St. John's, NL
10%
Office
Total Newfoundland & Labrador Assets
188,170 Bell Aliant
68,196 Gov't of NL
99,470 CNLOPB, KPMG, TD Bank
792,820
Total Office
2,500,930
12
Millbrook Mall
Corner Brook, NL
100%
Retail
13
Fraser Mall
Gander, NL
100%
Retail
98,883 Gov't of NL, Sobey's, Wescal Sports Ltd.
14
Marystown Mall
Marystown, NL
100%
Retail
91,990 Loblaw, Home Furniture Gallery
Total Retail
TOTAL COMMERCIAL
114,386 Shoppers Drug Mart, Cineplex, YMCA
305,259
2,806,189
Note: Brunswick Square is comprised of Brunswick Square Shopping Centre, Brunswick Square Office Tower and
Delta Brunswick
Fortis Commercial Portfolio
 Total purchase price:
$430,000,000 – Acquired by Slate
Office REIT
 The REIT will enter into a
strategic co-ownership
agreement with a Canadian
institutional real estate fund,
Slate retain a 10% interest in
three of the properties (TD Place,
Cabot Place, and Fortis Place) and
the Co-Owner will acquire a 90%
increase
Fortis Commercial Portfolio – Slate Proportionate Share
VENDOR
PURCHASER
DATE
SALE PRICE
BUILDING TYPE
SIZE (SQ.FT.)
Fortis Properties
Slate Office REIT
Pending
$304,000,000
Office
2,463,910
OCR
8.2%
PRICE PER SQ. FT.
$123
What Asset Classes are Preferred in 2015?
Source: Altus InSite
Impact on OCR’s of a 100 BPS Increase in interest Rate
Source: Altus InSite