To Canadian Funds, U.S. Real Estate Looks Ripe
From The Wall Street Journal:
Pension funds north of the border have poured about $9 billion into U.S. commercial real estate in the past three years, after largely steering clear of owning hotels, office buildings and apartments in the U.S. before then.
While there are only a handful of big funds that are active abroad, they are having a disproportionate impact on the U.S. market by funding ambitious plans that domestic investors have been afraid to touch.
Canadians funds see value in the U.S. as they expand beyond their own overheated property market. And, since the Canadian market wasn’t hit as badly as the U.S. during the financial downturn, these pension funds are less gun shy about putting money to work in riskier projects.
Ivanhoe Cambridge, the real-estate investor for Caisse de depot et placement du Quebec, in May said it was investing $300 million to build a 45-story office tower in the West Loop of downtown Chicago. When completed, the 900,000-square-foot project will be the largest-size new property development in five years in that city at a time when no other major office projects are underway.
“The majority of institutional investors would say the U.S. is No. 1 on their list today,” says William Tresham, president of global investments for Ivanhoe Cambridge. “….Canadian assets are around an all-time high.”
Read more: http://online.wsj.com/article/SB10001424127887323706704578229770064523416.html