Dream Office REIT strikes $1.7B deal for properties to be sold

Part of the sum to come from REIT’s sale of its stake in Toronto’s Scotia Plaza

Dream Office REIT strikes $1.7B deal for properties to be sold
Steve Randall
Late last week, Dream Office REIT announced that it has struck a deal to sell office properties for $1.7 billion, with $750 million of that coming from the sale of its 50 per cent stake in Scotia Plaza in downtown Toronto to co-owners KingSett Capital and the Alberta Investment Management Corp.

The Toronto-based real estate investment trust said it will use some of the proceeds to buy back and cancel $440 million worth of its investment units, The Canadian Press reported.

The REIT added that it plans to cut its annual investor distributions from $1.50 to $1 per unit to boost cash flow to reinvest in its business.

If completed, the sales will result in a total of $3.2 billion raised since it adopted a strategic plan early last year with a target of $1.2 billion over three years, officials said.

Dream Office explained that the value of its income properties portfolio will fall from $6.1 billion 18 months ago to about $2.9 billion, with about half of that centred in downtown Toronto.

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