In the first half of 2016, Chinese-invested commercial real estate reached $1.3 billion, of which the Bentall Centre represented over $1 billion in a sale that saw Anbang Group, a Beijing-based company, purchase the 1.5 million square foot office complex, with some retail, located in Downtown Vancouver’s Financial District.
The Bentall Centre sale includes the 22-storey One Bentall Centre at 505 Burrard Street, the 18-storey Two Bentall Centre at 555 Burrard Street, the 32-storey Three Bentall Centre at 595 Burrard Street, and the 35-storey Four Bentall Centre at 1055 Dunsmuir Street. The purchase stakes 66% controlling interest in the four towers from Ivanhoé Cambridge Inc., a subsidiary of Caisse de dépôt et placement du Québec. The sale did not include the newer Bentall 5, which was purchased by German investment firm Deka Immobilien Investment GmbH in 2009 from a Quebec pension fund for $297 million. In 2012, Deka turned around and sold Bentall 5 for $400 million to several Canadian pension funds whose investments are managed by Bentall Kennedy, a firm once related to the Bentall family, which built the original four buildings from 1967 to 1981.
Anbang Group’s over $1 billion investment into Vancouver’s Bentall Centre this year pushes the first half of 2016 Canadian commercial real estate sales with $1.3 billion invested from China and Hong Kong way past the $309 million that was invested by Chinese in the first half of 2015, last year.
These sales are likely inspired by the government of China’s “Go Global” policy, which enourages Chinese companies to invest and operate abroad in an effort to diversify their nation’s economy. This policy reduces China’s traditional dependence on domestic production and exports, which in turn has infused an even greater influx of Chinese investments into Vancouver’s rapidly growing real estate market.
Interest in Vancouver office space has not been confined to just Asian investors though. Attracted by the relatively low Canadian dollar, now coupled with the uncertainty of the United Kingdom’s Brexit vote, European investors are eyeing the market. German multi-billionaire Klaus-Michael Koehne recently reportedly paid $400 million for Royal Centre, a 36-storey building at 1055 West Georgia Street.