According to a recent news report, Canadian investors are buying heavily in U.S. commercial real estate, including at least one landmark property in Manhattan. Developers and pension funds from north of the border are reportedly looking to the U.S. market because the large Canadian pension funds have a tight grip on the domestic market, and comparatively few Canadian properties are being traded.
In the first three quarters of this year, Canadian investors have put about $8 billion into the U.S. commercial property market. They have been the leading foreign investors in U.S. real estate for the past four years. The Chinese are in second place, but have only invested about a fourth as much as the Canadians during the same period.
In one major deal, Ivanhoe Cambridge, the real estate giant that is part of Canada’s biggest pension fund, is teaming up with Callahan Capital Properties of Chicago to buy the 1095 Avenue of the Americas building from Blackstone Group for $2.25 billion. Once it closes the deal will be the second-largest sale of a U.S. office building since 2008. Ivanhoe already owns two other Manhattan office buildings, 1411 Broadway and 1211 Avenue of the Americas.
Closing the deal on a purchase of commercial property in Manhattan requires solid due diligence and attention to detail. Experienced legal counsel is needed to negotiate the terms of the agreement, prepare deeds, review title issues, and draft financing and other documents. After closing, the new owners may need assistance with rezoning issues, regulatory compliance and lease disputes. Having an experienced New York City real estate law firm on your side can make the whole process go more smoothly.
Source: WTAQ.com, “Canadians snap up U.S. commercial real estate at record pace,” Allison Lampert & Martin Howell, Nov. 18, 2014