Foreign buyers’ reported love affair with Canadian real estate isn’t just limited to the residential market. According to CBRE, more and more Canadian hotels are being snapped up by investors from outside of the country.
The Globe and Mail reported that roughly 24 per cent of the $794-million invested in Canadian hotels during the first half of 2013 came from foreign buyers. The same period in 2012 saw only 7 per cent of the $650-million worth of hotel deals come from foreign investors.
The King Edward Hotel in Toronto was among this year’s high-profile hotel sales. The Texas-based Omni Hotel & Resorts recently announced they’d become the long-term operator of the historic space and put $40 million in renovating the luxury hotel.
Now that the Chateau Laurier is up for sale, we can’t help but wonder if non-Canadians will scoop up the landmark in the nation’s capital. Ivanhoe, the real estate subsidiary of Caisse de Depot et Placement du Quebec, put the hotel on the market and also owns the Fairmont Royal York Hotel in Toronto. According to Sylvain Fortier of Ivanhoe, the The Royal York is due for major renovations and the subsidiary is looking at various plans for the building.
Bill Stone, an executive vice-president at CBRE, told the the newspaper, “Historically Canadian investors bought Canadian hotels, by and large, and this is one of the first substantive breakout years.
“We’ve seen a real spike, in the last eight to 12 weeks specifically, of activity.”
The bulk of hotel transactions were in the GTA during the first half of 2013. Overall, the region saw 16 hotels, worth an aggregate $415.6-million, change hands. During the same time in 2012, only six GTA hotels were sold off, totalling $221.7-million.
More than half of the total Canadian hotel transaction volume in the first six months of this year took place in the Greater Toronto Area, where 16 hotels, worth an aggregate $415.6-million, were traded. Only six hotels in the GTA were sold during the same period last year, totalling $221.7-million.
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