Sleuthing by RBC’s Neil Downey reveals CAP REIT’s surprise shareholder

, International

RioCan REIT and Canadian Apartment Properties REIT operate in different parts of the real estate world.

According to Neil Downey, a managing director and real estate analyst at RBC Capital markets, the evidence is beyond a reasonable doubt.

What’s less clear is the motives behind the news that one real estate investment trust is the largest shareholder in another real estate investment trust.

In a note to clients this week, Downey said he has been convinced “for some time” that RioCan REIT (REI) has a major stake in Canadian Apartment Properties REIT (CAR.) Now “with Q1/16 disclosures, we now see evidence beyond a reasonable doubt that REI is CAR’s largest unitholder,” wrote Downey, who is a tad perplexed about the strategy behind the investment that was valued by RioCan at $323 million at the end of the first quarter.

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