REAL CAPITAL MARKETS Session C3: Real estate investment in an unpredictable environment: the perspectives of pension funds, REITs & private equity funds Sponsored by CIBC
INTRODUCTIONS MODERATOR: Jeff Thomas , Managing Partner, Ashlar Urban Realty Inc . PANEL: Peter Cuthbert , Senior Vice President & Partner, Fiera Properties Jonathan Gitlin , Senior Vice President, Investments, RioCAn REIT Steven Gross , Managing Partner, Real Estate Investments, Romspen Investment Corporation Tony Vadacchino , Vice President, Investments, Oxford Properties Group Inc.
NEWS “Blackstone Buying US Centers from Riocan for $1.9B – Bloomberg, Dec. 18, 2015 “Canadian building permits jump on plans for multi - family homes” - Globe, Jan18, 2016 “Canadian Real Estate feels the love from foreign buyers” – Reuters January 25, 2016 “ Artis REIT Seeking Sale of Alberta Office Towers” – Bloomberg, January 29, 2016 “Canadian’s love affair with Manhattan real estate seems unabated” – Reuters, Feb 5 2016 “Calgary takes stock of grim landscape a year after oil downturn” – The Star, Feb 8, 2016 “Chinese company purchases Bentall Centre’s Four Towers” – Vancity, February 18, 2016 “Dream jumps most in 7 years on plan to sell $1.2B and cut payout” - FP, Feb 19, 2016 “CF Promenade on the block” – Toronto Star, Feb 22, 2016
RECORD LEVEL OF ACTIVITY Greater Toronto Area source: Realnet Record Level of Commercial Investments $16.0 $14.0 Total $ Volume $12.0 $10.0 $8.0 $6.0 $4.0 $2.0 $0.0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
RECORD LOW CAP RATES Record Low Cap Rates 8% 7% 6% 258 8 bp 5% Avg. Rates 4% 5 Yr. Bond Avg. Apartment 470 0 bp 3% 2% 1% 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
CAD DOLLAR AND FOREIGN BUYER
EQUITY ISSUANCE DOWN REIT & REOC Issuance Billions Source: CBRE $6 $4 $2 $ 2010 2011 2012 2013 2014 2015
UNSECURED DEBT Unsecured Real Estate Debt Issuance/Maturities Source: CMLS $8 ISSUANCE & MATURITY ($BILLIONS) SENIOR UNSECURED DEBT $6 $4 $2 $0 2010 2011 2012 2013 2014 2015
SELLERS VS BUYERS? GREATER TORONTO AREA 2015 - OFFICE, INDUSTRIAL, RETAIL: NET NET SELLER SELLERS NET NET BUYERS UYERS REITS (- $106M) PRIVATE EQUITY ($734M) PENSION FUNDS (- $504M) FOREIGN
INTRODUCTIONS MODERATOR: Jeff Thomas , Managing Partner, Ashlar Urban Realty Inc . PANEL: Peter Cuthbert , Senior Vice President & Partner, Fiera Properties Jonathan Gitlin , Senior Vice President, Investments, RioCAn REIT Steven Gross , Managing Partner, Real Estate Investments, Romspen Investment Corporation Tony Vadacchino , Vice President, Investments, Oxford Properties Group Inc.
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