U.S. real estate giant Blackstone says it won’t target single-family homes in its Canadian expansion
Blackstone Inc. BX-N said on Monday it had no interest in investing in single-family homes in Canada, ending speculation that the global asset management giant would scoop up hundreds of Canadian homes and turn them into in rental properties.
After Blackstone announced plans in May to establish a Canadian office in Toronto, rumors abounded that the private equity firm would unleash its firepower, gobble up homes and increase competition for individuals and families seeking to buy houses. The typical price of a home across the country has soared 50% over the past two years and real estate investors have come under scrutiny for their role in heightening competition and rising prices. price.
But Blackstone’s head of real estate for the Americas, Nadeem Meghji, said that was not in the cards for the company’s Canadian expansion.
“It’s just not something we’re focused on in Canada,” he said in a joint interview with Janice Lin, the new director of Blackstone Canada.
Blackstone targets Canadian real estate and opens an office in Toronto
The New York-based company, which manages $915.5 billion in assets, has been accused of profiting from the US housing slump in 2007 after buying up lots of distressed properties and dumping them then leased to US residents.
Blackstone said he did not own any single-family homes before the crisis and did not foreclose on any of the properties. He also said many of his purchases were homes that had been left vacant and driving down local property values.
Blackstone has since sold that business and owns a leasing business called Home Partners of America – one of many players in the growing single-family home rental market in the United States.
“We don’t have a similar platform in Canada and we have no plans to launch one because, from our perspective, we believe there are simply better places to deploy capital. in the Canadian market,” said Meghji.
Ms. Lin, a former executive of the Canada Pension Plan Investment Board, is responsible for Blackstone’s expansion in Canada. She cited the country’s favorable immigration policies and strong population growth as two key factors that make Canada a winner for the capital of Blackstone.
Blackstone primarily owns warehouses and other industrial space in Canada, as well as a few office towers. It also has investments in apartment building developments. Together they are worth around US$14 billion, according to Blackstone, which is only a tiny fraction of the company’s global real estate portfolio.
Both Ms. Lin and Mr. Meghji said the company would continue to invest in industrial and high-end office buildings, as well as hotels.
Blackstone has previously said it expects its growth here to be significant. Meghji wouldn’t quantify “significant” except to say he expects growth to be significant and that Canada could eventually command a larger share of Blackstone’s global real estate portfolio.
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