Winnipeg Free Press - PRINT EDITION
Posted: 02/8/2014 1:00 AM | Comments: 0
The tallest building in town can be yours, but it's probably going to set you back nine figures.
201 Portage, the 33-storey skyscraper at the northwest corner of Portage and Main, has been put up for sale by its owners, David, Gail and Leonard Asper.
Also included in the package is the empty lot at 416 Main St., where the Aspers once considered building a second tower, and the adjoining parkade.
The offspring of Izzy and Babs Asper haven't set a specific list price for the tallest structure between Calgary and Toronto, but local expert Joe Banfield said the building could sell for "north of $120 million."
"It's a very hot market for buying quality buildings. There will be national and international interest in that property," said Banfield, principal with Banfield Office Properties Group in Winnipeg.
Arni Thorsteinson, Winnipeg-based president of Shelter Canadian Properties, agreed.
"Commercial real estate values in Canada are at an all-time high. The main reason is low interest rates," he said.
Banfield said it's not uncommon for sellers of large properties to not set a price and just take offers.
"If you leave it unpriced but tell potential buyers the cash flows and ask, 'What are you willing to pay?' it tends to generate a larger stretch from the buyers," he said.
Thorsteinson said he has no doubt the property will generate plenty of interest, possibly even from Shelter.
"Potentially," he said, politely declining to speculate on the final sale price. "Lots of interest is what you need to get an auction going."
Thorsteinson said several "trophy" assets have sold in the past couple of years for prices that "amazed" market watchers. At the top of that list is Toronto's Bayview Village mall, which fetched $500 million last fall.
David Asper said neither he nor his siblings were prepared to comment on the sale of the building.
The trio first bought into what was then known as TD Centre and its adjacent land in 2003, when it joined with O&Y Real Estate Investment Trust in purchasing it for $69 million. The Aspers subsequently bought out O&Y's interest.
One industry source, who asked he not be identified, said with all of the activity downtown, fuelled partially by the return of the NHL and the early days of the $600-million Sports Hospitality and Entertainment District, the Aspers have chosen a good time to sell.
"Interest rates are at an all-time low. That usually means you can pay more," he said.
Construction costs to erect a similar building would likely be in the $300 to $350 per square foot range, approximately triple what 201 Portage cost to build in the late 1980s, he said.
Putting in an offer is a two-stage process. First, would-be buyers send in their particulars and sign a confidentiality agreement.
After that, they'll get a package with all the details.
"They don't want tire-kickers," Thorsteinson said.
Republished from the Winnipeg Free Press print edition February 8, 2014 B6
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