The Canadian Pension Plan Investment Board (CPPIB) has purchased a 40% interest in Scotia Place, a downtown Edmonton office tower, for $64 million. The total value of the 600,000-square-foot office complex is $160 million.
Morguard Real Estate Investment Trust, which previously owned 100% interest in the Class A tower, will retain a 20% stake. The remaining 40% interest will go to unnamed an investment manager.
Gaeme Eadie, the CPPIB’s senior vice-president for real estate investments, says the acquisition is an “extension of the plan we already have underway,” referring to the board’s “strategy of owning core properties in strong real estate markets.”
Alberta’s booming economy has helped mark downtown Edmonton as an ideal market to put forth that strategy. The CPPIB already holds an interest in six Class A properties in Edmonton that total around two million-square-feet. Scotia Place, Eadie says, “is one of the better buildings in Edmonton. It’s a good quality asset and the returns look attractive.”
The CPPIB has $3.6 billion invested in Canadian real estate, including eight shopping centres and approximately 15 properties in the office sector. The organization had approximately $6.2 billion in real estate interests worldwide, as of Sept. 30, 2007.
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