What do you do with a sparkling new waterfront building in a hot property market?
You sell it.
At least that’s what Corus Entertainment did. As of Monday, its headquarters on the north shore of Lake Ontario is owned by H&R REIT , which acquired the 485,000 square foot building for $186-million. Not only does H&R get a fancy new property, it also acquires the slide erected in the middle of it.
The building itself isn’t even three years old, having been completed in only 2009. and the area around it is up-and-coming with George Brown College erecting its new campus directly beside it. Sugar Beach, Toronto’s ‘downtown’ beach is also nearby.
Corus will remain the main tenant, and has restructured the terms of its lease, which means H&R gets an investment grade tenant for the next 20 years. H&R also didn’t pay an exorbitant amount, acquiring the building at a 6.4 cap rate, which is much lower than the sub-4-per-cent rates you hear being thrown around for buildings such as Scotia Plaza right in the downtown core.
H&R is also completing the Bow in Calgary, and Encana will be the lead tenant there.
An earlier version of this post incorrectly identified the slide in Corus's headquarters as a waterslide. It's just a plain vanilla one. Sadly.