Canadian pension funds snap up New York towers

Canada's two largest pension funds are expanding their holdings of New York real estate, announcing separate deals to buy stakes in Manhattan office towers.

Ivanhoe Cambridge, the Montreal-based real estate unit of pension fund Caisse de depot et Placement du Quebec, agreed with its joint-venture partner to acquire a 49 per cent interest in 330 Hudson St for about US$150 million, according to a statement.

Canada Pension Plan Investment Board, the country's largest pension fund, is taking a 45 per cent stake in 1 Park Avenue, controlled by Vornado Realty Trust.

Canadians were the biggest foreign buyers of commercial property in the US last year and the second-largest in New York, behind the Chinese, according to Real Capital Analytics.

Ivanhoe Cambridge has made five US office deals through its partnership with Callahan Capital Properties as it seeks to boost its real estate investments.

"Canada has tremendous financial resources with which to invest and they're some of the largest sovereigns in the world," said Doug Harmon, a broker with Eastdil Secured who worked on both deals. "They've had a big head start as far as investable dollars and making friends and relations in New York."

Ivanhoe Cambridge's Manhattan deals include an October agreement for a 51 per cent stake in the News Corp building at 1211 Avenue of the Americas.