Foreign investment in real estate revs up as InnVest goes in cash deal

, Financial News

The deal to buy Innvest REIT gives Bluesky one of Canada's largest hotel portfolios with 109 properties, including a stake in Toronto's Fairmont Royal York Hotel.

The weak loonie continues to drive Asian investors to the Canadian marketplace as the currency likely played some part in the recent purchase of InnVest Real Estate Investment Trust, which counts a stake in Toronto’s famed Fairmont Royal York among its holdings.

Bluesky Hotels and Resorts Inc., which describes itself as Canadian-based company backed by Hong Kong capital, will pay $2.1 billion, including net debt, to acquire Toronto-based InnVest which owns 109 hotels representing 14,500 guest rooms along with a 50 per cent share of franchiser Choice Hotels Canada. It owns a 20 per cent stake in the Royal York.

Unitholders of InnVest will received $7.25 cash per unit which is a 37 per cent premium over its 30-day volume-weighted average price of $5.28. The deal, announced Tuesday night, has been unanimously supported by InnVest’s board and has the support of 29.1 per cent of unitholders, including KingSett Real Estate Growth LP No. 5.


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