Chinese investors snag Vancouver’s biggest real estate prize: All four towers of the Bentall Centre

Chinese investors have won one of the most important real estate auctions in Vancouver history, swooping in to grab a controlling curiosity about all four towers from the Bentall Centre.

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Sources confirmed towards the Financial Post that Anbang Insurance Group Co. Ltd., a Beijing-based company having a reported US$114 billion in assets, is buying what amounts to a 66 percent stake in Bentall I, II, III and IV – a sprawling commercial 1.5-million-square-foot office complex, with some retail, in the middle of Vancouver.

It was reported in October that Ivanho Cambridge Inc., a subsidiary of Caisse de dp?t et placement du Qubec, was selling its stake in the four towers. The cost paid by Anbang values the whole complex at a lot more than $1 billion, based on sources. The deal hasn’t yet closed.

Anbang continues to be been looking for more opportunities in Canada after paying $110 million this past year for a land lease of HSBC Building at 70 York St. Toronto. The Chinese company bought the land lease, which provides it ownership of the building for a set period of time, from Brookfield Office Properties with what was considered one of the greatest recent valuations for a building in Toronto.

It’s a complete jewel of a property

But the insurance coverage company’s biggest United states splash was probably in 2014 when it bought the famed Waldorf Astoria in New York City for US$1.9 billion. Bentall Centre could be its largest foray into Canada – as it takes over the Ivanhoe stake. Each tower includes a slightly different ownership structure but Great West Life Assurance effectively controls 34 per cent of the the 4 centres combined.

The deal is constantly on the show the appetite of Chinese investors for that Canadian market, particularly in Vancouver where concerns continue to rage about Asian buyers getting into the city’s residential market.

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Interest in Vancouver office space is not limited to just Asian investors. Attracted through the struggling loonie, European investors have also been eyeing the market. German multi-billionaire Klaus-Michael Kuehne has been said to to have paid $400 million for Royal Centre, a 36-storey building at 1055 West Georgia Street, last month.

Ross Moore, a completely independent real estate consultant, said Chinese investor interest is probably at an all-time high. “We’ve seen it on the residential side however it’s on the commercial side,” he explained.

Moore said he can’t recall a bigger deal in Vancouver commercial history, once the four buildings are thought as one entity.

“It’s a complete jewel of the property,” said Moore, concerning the buildings that are relatively dated using the newest one built-in 1981. “It’s an older property but irreplaceable. It’s hard to beat the place. You’re located on top of SkyTrain and tenants just love it. It always leases up. I’ve never seen significant vacancy, they are always full.”

Scott Chandler, senior vice-president of advisory and investment sales with Colliers International, said the weak Canadian dollar continues to drive interest in commercial real estate, but the benefit of Vancouver can’t be prevented.

“It’s hot and incredibly strong. It’s a higher growth area with a large urban population and limited land. All this is driving up prices,” he explained.

The attract Chinese investors can also be pretty simple: “It’s a secure haven inside a safe financial system,” he said.

Financial Post

gmarr@nationalpost.com
Twitter.com/dustywallet