Foreign buyers snapping up more and more Canadian office buildings

Class A office buildings in Canada have proven to be incredibly attractive for foreigners who have a newfound wariness towards investing their money in Europe post-Brexit, according to industry players.
Latest figures from Colliers noted that Canada’s Class A buildings, defined as “high-quality properties in prominent locations that tend to draw the best tenants and command higher rents,” have been valued at $2.7 billion in the first two quarters of 2016, a significant jump from $415 million around the same time last year.
Vancouver and Toronto were found to be the epicentres of this transaction volume, reported Reuters. In fact, 2016’s year-to-date sales have already exceeded total annual sales in 2014 and 2015.
“Foreign buyers view these assets as safe bets as they look to diversify their global real estate portfolios,” according to Ashi Mathur, BMO Capital Markets head of North American real estate investment and corporate banking.
Chinese buyers have played a central role in this development, Colliers added. Meanwhile, European investors have expressed greater interest in Canada after U.K.’s Brexit vote.
“I would argue in a world that has so much uncertainty ... increasingly global investors are going to say Canada is a very good place to be,” CBRE Toronto executive vice president Paul Morassutti stated.
“Canada's weaker currency, combined with our lower volatility and lower geopolitical risk, makes us very appealing to certain foreign buyers today - notwithstanding where we are in the valuation cycle,” Trimaven Capital Advisors managing director Jeffrey Dean agreed.

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