Skip to main content

Report On Business Ivanhoé strikes again, agrees to deal for office space in Seattle

The Seattle skyline is seen in this undated file photo.

Photos.com / Getty

Canadian real estate company Ivanhoé Cambridge is flexing its investment muscle again in the United States with a $280-million (US) deal for office space in Seattle, one of America's strongest urban economies.

On the heels of a monster transaction earlier this month that saw it buy a 42-storey office tower on Manhattan's Bryant Park for $2.25-billion (US), Ivanhoé and partner Callahan Capital Properties are now acquiring two office buildings in Seattle's downtown core. The seller is said to be Chicago-based private equity firm Walton Street Capital.

Ivanhoé, the real estate unit of pension fund manager Caisse de dépôt et placement du Québec, is buying 1111 Third Ave., a 34-storey office tower that's been recently renovated as well as an adjoining historic low-rise at 1100 2nd Ave. The agreement is expected to be announced Monday.

Story continues below advertisement

"Seattle is a gateway city and is one of the strongest office market cities in the United States," said a person familiar with Ivanhoé's strategic thinking, noting the west coast city's employment numbers are strong and fuelled by its knowledge based and technology industries.

Among the multinational companies that call Seattle home are aerospace giant Boeing Co., online retailer Amazon, and coffee purveyor Starbucks Corp. Microsoft and Costco are also based in the region.

Ivanhoé is putting its money back to work in Washington state after selling its interest in a large portfolio of 17 properties earlier this year. Its part of a larger move by the Caisse to shift more focus to private investments like infrastructure and real estate, particularly in the United States. Caisse management believes that public equity markets will turn down and interest rates will remain low in the months ahead.

The purchase brings to four the number of properties Ivanhoé owns in downtown Seattle, giving the company 13 per cent of the city's Class A office market in the central core stretching over 2.6 million square feet. Ivanhoé controls some of the choicest commercial properties in the city with skyscrapers Wells Fargo Center and U.S. Bank Center also among its holdings.

Ivanhoé also owns two separate properties in nearby Bellevue.

The two new downtown buildings Ivanhoé is buying were part of a 2.6 milion square-foot portfolio owned by a Goldman Sachs subsidiary that was pushed into receivership in 2012 by Walton Street and other lenders, the Seattle Times reported over the weekend. A court appointed Seattle-based Talon Private Capital as general receiver for the portfolio and Walton Street eventually took title to the entire set, the newspaper said.

The acquisition marks Ivanhoe's seventh purchase with Callahan Capital Properties, bringing their joint investments in U.S. office real estate to nearly $2.7-billion (US).

Report an error Editorial code of conduct
Tickers mentioned in this story
Unchecking box will stop auto data updates
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

Cannabis pro newsletter