The asset-management arm of Wall Street investment bank Goldman Sachs Group Inc. is taking a minority stake in Toronto’s Slate Asset Management, according to sources familiar with the matter.
The investment, which is expected to be announced Monday morning, will see Goldman buy a minority interest in Slate, a real-estate focused investment company with more than $6-billion in assets under management. It runs a collection of office, retail and industrial properties in Canada, the United States and Germany, including a number of large office towers in midtown Toronto and plazas and malls across the U.S. South and Midwest.
Founded in 2005 by brothers Blair and Brady Welch, the privately-owned company has completed over $11-billion of transactions globally in both private equity funds and publicly traded real estate investment trusts (REITs). The company has listed two real-estate trusts on the Toronto Stock Exchange: the Slate Office REIT and the Slate Retail REIT.
The deal is being made through Goldman Sachs Asset Management’s Petershill unit, which acquires stakes in alternative asset managers. In early 2018, Goldman raised US$2.5-billion for Petershill and has purchased minority interests in a number of investment managers, including Britain-based hedge fund firm LMR Partners, real-estate investment company Westbrook Partners and venture capital firm Industry Ventures LLC.
Slate Asset declined to comment on the transaction, while Goldman Sachs did not return requests for comment.
Goldman has been aggressively growing through acquisition in its wealth management business. Earlier this year it scooped up United Capital Financial Partners Inc. for US$750-million in cash, adding US$25-billion in assets under management and 220 financial advisers to its wealth business.
The deal will not affect any day-to-day operations, investment decisions or executive roles at Slate Asset Management, according to sources who were granted anonymity because they were not authorized to speak publicly about the matter. The financial details of the transaction are not expected to be disclosed.
Earlier this year, one of Slate’s investment funds acquired a grocery real estate portfolio in Germany for €31.5-million ($46.3-million), while in 2017 another of Slate’s investment funds acquired Calgary’s Scotia Centre in 2017.
The Calgary deal was part of a $1.14-billion acquisition of a 97-property portfolio in Western Canada, Ontario and the Atlantic provinces in a deal with Cominar Real Estate Investment Trust.
With a report from Tim Kiladze.
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