Canada’s Dream Industrial Real Estate Investment Trust (DIR_u.TO) has held talks with potential suitors to explore the prospect of selling itself, according to two sources familiar with the situation.
Possible buyers could include asset managers, pension funds, private equity firms, insurers and real estate companies, the sources said.
The sources, who spoke on condition of anonymity as the matter is not public, did not disclose the names of potential buyers Dream Industrial held talks with.
They also said there has been a disconnect between the price expectations of the seller and buyers, so it is not clear if any deal will be reached.
Shares of Dream Industrial jumped on the news, hitting their highest in nearly a year. They rose as much as 6 percent and were trading up 3 percent on Thursday afternoon.
Players who have shown interest in industrial properties include entities backed by Brookfield Asset Management (BAMa.TO), Canada Pension Plan Investment Board and Alberta Investment Management Corp. Pure Industrial Real Estate Trust (AAR_u.TO) could also be interested, one of the sources said.
Dream Industrial, Brookfield and AIMCo did not respond to requests seeking comment. CPPIB declined comment.
“We would never comment on rumors,” Pure Industrial CEO Kevan Gorrie said.
Pure Industrial on Wednesday raised $149.8 million (US$115.67 million) in a bought deal and said its plans for the money included repaying debt and funding acquisitions.
Dream Industrial is part of a small universe of REITs that are focused on industrial properties. Others in the space include Pure Industrial, Granite REIT (GRT_u.TO) and WPT Industrial Real Estate Investment Trust (WIRu.TO). AIMCo recently increased its stake WPT Industrial REIT.
Dream Industrial REIT, which owns industrial properties across the country, is one of several firms launched by Canadian real estate investor Michael Cooper. Cooper is also chair of the trust.
Canadian real estate investment trusts have had a bumpy ride over the past 12 months. While unit prices of REITs with exposure to Alberta have taken a hit since the price of oil started falling in mid-2014, they have been rebounding in recent months.
Units of Dream Industrial REIT have added about 12 percent since the start of the year, compared with a 14 percent gain in the S&P/TSX REIT index.
Formerly Dundee Industrial REIT, Dream Industrial REIT has assets worth $1.7 billion.
(Reporting by John Tilak; Editing by Alan Crosby and Cynthia Osterman)
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