Pension Board dives into hot Toronto market

The Canada Pension Plan Investment Board (CPPIB) is at it again, this time investing $105 million in one of Toronto’s hottest neighbourhoods for real estate.

The investment, which bought them a 60 per cent stake in Minto High Park Village properties, signals the organization’s entry into the multi-family real estate market.

With strong population growth and high demand for rental property, the move represents a key strategic move for the organization going forward.

The CPPIB found the deal intriguing because there was a limited supply of high-quality rental properties. With population growth and declining homeownership, it was a win-win situation.

The CPPIB plans to groom a relationship with Minto Properties, which owns 40 per cent and will continue to oversee the management and leasing of rental properties. There are three towers and 750 rental units, according to an article in the National Post.

In total, Minto manages more than 17,000 units in Toronto, Calgary, Ottawa, Edmonton and London.

With its assets in eight U.S. markets, totaling $1.3 billion, Peter Ballon, managing director and head of real estate investment at CPPIB, says the organization has been trying to replicate its U.S success in Canada.

“We have had great success in the U.S…. a very substantial portfolio [and] great partners,” Ballon said in an interview with the National Post.

“I do think the window for investing is opening up a little bit in the multi-family sector,” he said. “We let the markets tell us if there’s deals. We don’t really predict.”

By March 31, 2015, the CPP Fund totalled $264.6 billion, with $34.1 billion in real estate investments.

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