Canadian Investors Taking Over Manhattan Real Estate, Reaches a Record High for Real Estate Purchases

Canadian real estate investors and developers are taking over most of the real estate deals in Manhattan, overtaking other foreign investors such as the Chinese and the Russians.

            According to the report of Real Deal, records from Real Capital Analytics show that Canadians invested $3.8 billion into the city's property market so far this year, already nearly doubling last year's $1.97 billion total, and surpassing the previous record of $2 billion set in 2007.

            Canadians have bought more properties in Manhattan than any other foreign investor in the last decade. They have invested an estimated amount of $15.5 billion for real estate and property purchases.

            A report from Bloomberg Business stated that the take-over of the Canadians in Manhattan's real estate was led by institutional investors like the Canada Pension Plan Investment Board, Caisse de Depot et Placement du Quebec, and the Ontario Municipal Employees Retirement System.

            "Canadian investors - pension funds, private equity - are sitting on a pile of wealth that needs to be invested," Real Capital senior vice president Jim Costello said. "There's an understanding that there's always somebody who wants to buy an asset in New York," Costello added.

            Arthur Lloyd, an executive vice president at Ivanhoe North America, said in e-mail to Bloomberg that, "Manhattan is a very liquid market." He adds that, "The city carries greater potential for growth in rent and operating income than other cities while being resilient in downturns like other global cities such as London."

            The Manulife Financial Corporation, Canada's largest life insurer, bought their first property in Manhattan two years ago, and they are looking forward to adding some more.

            In an interview with the global head of asset management for Manulife's real estate team, Ted Willcocks, in their firm's office in Toronto, Willcocks told Bloomberg that Manhattan is the "most competitive market in the country" and is "attracting phenomenal sources of capital -- both foreign and domestic."