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 Canadians accounted for almost a third of the $25.6 billion in
foreign capital that poured into Manhattan commercial properties
last year, with investment swelling to $8.3 billion from $1.97
billion a year earlier, according to data from Real Capital
Analytics.
In comparison, investment from other countries more than doubled
during the period, the data showed.
"The trend will continue in New York," said Ric Clark, chairman of
Brookfield Property Group, a real estate division of
Toronto-headquartered Brookfield Asset Management.
"We're in growth mode in Manhattan."
Brookfield Asset Management is Manhattan's second-largest landlord,
in all asset classes, after the City of New York, according to
CoStar Group Inc commercial real estate data compiled by Cushman &
Wakefield.
Brookfield has both bought buildings and announced plans to
construct new ones. Brookfield Property Partners, a spinoff of
Brookfield Asset Management, is now building a 62-storey residential
tower as part of its $4.5 billion multi-use Manhattan West
development.
Ivanhoe Cambridge, the real estate arm of Quebec's largest pension
fund manager, also ranks within the top 10.
In January 2015, Ivanhoe said it was buying 3 Bryant Park, a
Manhattan office property, for a near-record $2.2 billion.
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Brian Kriter, a Canadian senior managing director of valuation and
advisory for Cushman & Wakefield, said New York City should remain
the top market in the world for Canadian property investors such as
pension funds. He said the city now has over $15 billion worth of
commercial real estate that is available but not officially on the
market.
"We also expect to see more mega-deals as Canadian investors are in
a flight to quality," Kriter said.
During the first nine months of 2015, cross-border capital accounted
for 29 percent of investment volume in Manhattan, up from 19 percent
in 2014, according to data from Cushman and Real Capital.
Rising purchase prices and a weaker Canadian dollar, which fell more
than 16 percent against the U.S. dollar in 2015, have not
discouraged investors who see the value of steady returns from
rising Manhattan rents, Clark said.
For example, between the third quarter of 2013 and the third quarter
of 2015, average starting rents for office space have increased over
13 percent in midtown Manhattan to $75 per square foot, Kriter
wrote, citing Cushman data.
(Editing by Paul Simao and James Dalgleish)
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