OMERS' real estate arm Oxford on state of the business and economy
Oxford Properties Group is close to an agreement to sell a large shopping centre and two office towers in downtown Edmonton, Alberta, in a deal that could fetch more than $300 million, according to people with knowledge of the matter.
LaSalle Investment Management Inc.’s Canadian real estate arm, Montreal-based developer Canderel and North American Development Group are teaming up to buy City Centre and the adjacent Oxford Tower and TD Tower, said the people, who asked not to be identified because the matter is private.
LaSalle will be the majority stakeholder, while North American will manage City Centre and Canderel will manage the offices, according to the people. The deal is not final and may not go through.
Representatives for Oxford, the real estate unit of Canadian pension fund OMERS, Chicago-based LaSalle and Montreal-based Canderel declined to comment. Markham, Ontario-based North American didn’t respond to a request for comment.
City Centre, a four-level shopping mall spanning three city blocks, draws more than 10 million shoppers annually and is home to tenants such as Hudson’s Bay and Landmark Cinemas. Occupants of the office towers include TD Insurance, Enbridge Inc. and PwC Management Services.
The vacancy rate for the two Oxford towers is less than 5 per cent, compared with an average of 15 per cent for the Edmonton market in the fourth quarter, according to Avison Young. That rate, driven by openings of three new office towers since 2015, is expected to decline slowly starting this year, said Cory Wosnack, a managing director at the brokerage.
A deal for the Edmonton properties would follow Oxford’s sale this month of the Dynamic Funds Tower in Toronto. The firm is said to be in talks with potential buyers for 1250 René-Lévesque Boulevard West, one of Montreal’s iconic skyscrapers.