Price tag put at $350 million
Oxford Properties (Oxford) and the Canada Pension Plan Investment Board (CPPIB) have decided to sell a building in Vancouver that currently serves as Amazon's office location, along with an adjacent tower, insiders familiar with the sales process told Bloomberg.
Sources revealed to Bloomberg that Oxford and CPPIB anticipate receiving $350 million for the properties located at 402 Dunsmuir St. and 401 West Georgia St.
Following a period of stagnant activity in the Canadian office building market, this sale would mark a significant transaction. The last notable office deal took place last April when a downtown Toronto tower changed hands for roughly $380 million, as reported by CBRE Group.
Office building owners have faced challenges due to rising borrowing costs and changing tenant preferences influenced by remote work and downsizing.
Oxford and CPPIB's decision to sell the Vancouver properties will provide insights into the current value of such office towers amidst these evolving market conditions.
Both pension funds intend to manage their exposure to Vancouver's office market by divesting from more mature projects. It is worth noting that they are also near completion on another new office tower encompassing approximately 555,000 square feet of space, sources familiar with the matter told Bloomberg.
Both buildings being put up for sale are fully leased, with the Dunsmuir property completed in 2020.
