Sale-Leaseback of Seven Federal Office Properties Closes Today
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For immediate release
Toronto, Ontario, October 31, 2007 – The Honourable Michael M Fortier, Minister of Public Works and Government Services Canada (PWGSC) today announced the closing of the sale and leaseback of seven federal office properties. The Government of Canada is selling the properties to Larco Investments Ltd., a 100% Canadian-owned real estate company, for $1.41 billion and will lease the buildings for the next 25 years.
The decision to sell the properties resulted from an extensive open, transparent and competitive process. An analysis by international financial expert, Deutsche Bank, concluded this is a fair deal for Canadian taxpayers, particularly given the favourable market conditions.
"Investing in office towers is not - and should not be - a priority for government," emphasized Minister Fortier. "Today's sale allows the government to realize significant value for taxpayers while we continue to focus on what really matters to Canadians: providing the high-quality services and programs they need and deserve."
"Larco Investments Ltd. is very pleased with this transaction," said Amin Lalji, Larco Investments Ltd. Principal. "These properties will be core, stable, long-term assets for Larco Investments. They are located in prime locations, they complement our existing portfolio and we are guaranteed tenants for the next 25 years."
"This transaction was carefully designed to safeguard taxpayers and offer the greatest value to government," said Minister Fortier. "In fact, for the first time ever, the Auditor General of Canada will have access to the building-related financial statements of one of the government's landlords. This ensures a new level of transparency in government leasing."
Canadians will continue to have the same level of access to federal programs and services under the new ownership arrangement. The government will continue to occupy the buildings and display the Canadian flag, and maintain the right to name the buildings. The new owner will be required to respect the government's environmental, health and safety standards.
The seven office properties are located in five major cities across Canada: Edmonton, Calgary, Toronto, Ottawa and Montreal.
The government is fulfilling its commitment to be fully transparent and is making the following documents available upon request: the Deutsche Bank opinion letter, the Deutsche Bank report, the BMO/RBC interim report and the draft lease. Please contact PWGSC Media Relations (see below) to request copies.
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For further information or to request a media interview with Minister Fortier, please contact:
Jacques C. Gagnon
Director of Communications
Office of Minister Fortier
Office of Minister Fortier
Media may also contact the following for further information:
Public Works and Government Services Canada
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Photos of the seven office properties can be obtained by contacting Media Relations.
Additional information on the sale–leaseback can be found at http://www.tpsgc-pwgsc.gc.ca/services/initiative-eng.html
PWGSC news releases are also available on our Internet site at http://www.tpsgc-pwgsc.gc.ca/medias-media/index-eng.html