Concert says its CREC Commercial Fund LP will buy a 90 per cent interest in a million-square-foot distribution facility being built in Ottawa for international e-commerce leader Amazon.
The distribution centre will be the largest in the National Capital Region when construction is completed later in 2019, and is fully leased to Amazon on a long-term basis. Montreal-based developer and builder Broccolini, which currently owns and is constructing the facility, will retain a 10 per cent interest in the project.
CBRE Canada facilitated the deal.
“This is an exciting acquisition as it represents an excellent opportunity for the fund to establish a foothold in the Ottawa region with a high-quality e-commerce industrial facility, while supporting Concert’s continued national growth and expansion,” said Brian McCauley, Concert’s president and chief executive officer, in a release Thursday morning.
About the Ottawa distribution centre
Situated in the eastern portion of Ottawa on a 96.2-acre site, the 5225 Boundary Rd. facility will serve as one of Amazon’s network of fulfillment centres. Construction started in mid-2018, and is expected to be complete for fall occupancy.
The facility also includes 35,000 square feet of office and training space, features a 36-foot clear ceiling height, 99 truck-level doors and parking for more than 1,000 vehicles.
It is strategically located at a major interchange on the Trans-Canada highway, near the city limits on the main route between Ottawa and Montreal. The facility will support 600 full-time employees and serve key markets in Eastern Canada with a population base of more than five million.
“This deal represents a rare opportunity to strengthen our commercial income-producing property portfolio through the addition of an exceptional property and to partner with best-in-class, well-aligned groups in Broccolini and CBRE,” said Andrew Tong, managing director of CREC Commercial Fund LP, in the release.
Upon completion of the construction, Concert will enter into a co-ownership with Broccolini, a family-owned, single-source provider of construction, development and real estate services that caters to industrial, commercial and residential markets. Broccolini was selected by Amazon based on the company’s extensive experience and track record.
Amazon’s Canadian network
The Ottawa facility will be one of 11 Amazon fulfillment centres in Canada — several of which remain under construction. Amazon recently opened a 600,000-square-foot facility near Calgary, and is building three other distribution centres:
* a million-square-foot facility just outside Edmonton in Leduc County;
* a million-square-foot distribution centre in the Town of Caledon just north of Toronto. It already has three other fulfillment centres operating in the GTA;
* and a 450,000-square-foot centre at the Delta iPort in Metro Vancouver.
In total, Amazon is building about 3.5 million square feet of additional warehousing space across the country, as well as expanding its main downtown Toronto office and tech centre.
Amazon is a multi-national technology company with more than 600,000 employees and fiscal 2017 revenue of $177.9 billion US. Amazon is the largest e-commerce marketplace and cloud computing platform in the world as measured by revenue and market capitalization.
“Broccolini is excited to be partnering with Concert on this project,” says Michael Broccolini, vice-president, business development and finance, in the release. “Our shared values ensure that Amazon will continue to receive the exceptional quality service that defines Broccolini and Concert’s customer experience commitment.”
Concert’s fully subscribed CREC Commercial Fund LP is a diversified Canadian portfolio. With ongoing plans to expand, this open-ended, limited partnership fund invests in, and manages, commercial and office real estate in Canada.
The portfolio is managed by Concert and serves as Concert’s exclusive office and industrial platform. With the acquisition of this facility, the fund’s value will increase to approximately $1.6 billion and include more than 9.3 million square feet of industrial and office properties.
About Concert, Broccolini
Founded in 1989, Concert specializes in developing rental apartments, condominium homes and retirement communities, acquiring and developing commercial, industrial and infrastructure properties and in property management.
With offices in Montreal, Ottawa and Toronto, Broccolini is a family-owned provider of construction, development and real estate services. The company caters to the industrial, commercial and residential markets in Canada.