Canada Life Real Estate Fund

Established in 2005, the Canada Life Real Estate Fund invests in units of the Great-West Life Real Estate Fund. 

 

Fund Performance

as of  September 30. 2022

$6.8B

in real estate assets

$7.0B

in total assets

128

properties

Source of Return

2013201420152016201720182019202020212022
Income 4.7%4.8%4.5%4.5%4.5%4.3%4.2%3.8%3.8%2.5%
Capital 6.1%2.6%0.1%0.9%1.8%2.7%4.9%(1.3)%7.8%4.7%
Total 10.8%7.4%4.7%5.4%6.3%7.1%9.1%2.5%11.6%7.1%

Compound rates of return

(gross of investment management fees)
Three Month – Q3 -0.39%
Year-to-date 7.13%
One Year 10.97%
Three Year 7.91%
Five Year 7.91%
Ten Year 7.70%

Diversification by property type

By property type (millions)

Retail 9.42% $ 592
Office 28.4% $ 1,829
Industrial 30.6% $ 1,972
Residential 26.9% $ 1,738
Other 4.9% $ 320

Diversification by region

By region (millions)

British Columbia 10.7% $ 688
Alberta 10.0% $ 647
Prairies 1.2% $ 78
Ontario 66.8% $ 4,308
Quebec 10.3% $ 662
Atlantic 0.8% $ 54
U.S. 0.2% $ 14

Quarterly Highlights

Q2 2022 Canada Life Real Estate Fund Bulletin

Through the first half of 2022 the Canadian Real Estate Fund No. 1 has produced a 7.5% total gross return, bringing the trailing twelve-month total to 15%.  The 3% Q2 performance was comprised of 80 bps of income and 220 bps of capital return.  Portfolio occupancy improved by 70 bps to 91% as the residential component of portfolio saw its vacancy rate contract by 450 bps to 4%.  With the addition of approximately $195M in new financing, the Fund’s loan-to-value ratio has improved to 18.4%, up from 17.7% at the end of 2021.  Activity for the quarter is outlined below:

South Shore Industrial Portfolio, Montreal, QC
South Short Industrial Portfolio, Montreal, QC
33 Yonge Street, Toronto, ON
33 Yonge Street, Toronto, ON
33 Yonge Street, Toronto, ON (Interior)
Investment Transactions

The Fund continued to build out its Industrial allocation with the acquisition of a 290,000 sq ft six-building industrial portfolio on Montreal’s South Shore for $60M.  One additional asset within the node is scheduled to close in November for $29M.  When complete, the portfolio will total 417,000 sq ft of institutional quality industrial product built between 2013 and 2022.  The portfolio is 96% occupied and features a weighted average lease term of 8.2 years, which will improve the Fund’s overall occupancy profile. The South Shore node had been strategically targeted, as it is well served by transportation infrastructure and offers connections to the Island of Montreal, the Port of Montreal and the United States.  With the purchase, and continued valuation gains across the balance of industrial holdings, the asset class now represents the most significant weighting for the Fund. 

Financing Activity

Laird and Ridgeway business parks are two significant holdings for the Fund, comprising over 1.5M sq ft of newer generation, small and mid bay industrial product.   The assets are exceptionally well located in the west end of Mississauga, ON, with direct visibility from highway 403.  In June, the Fund completed a $171.5M financing on an interest only basis over a 6-year term.   Further, the Fund completed two CMHC insured refinancing initiatives over the course of the quarter at Laurier House in Vancouver, BC, and 1541 Riverside in Ottawa, ON, delivering $24M in new proceeds. 

Industry Recognitisions

33 Yonge, which is the headquarters of GWLRA in Toronto and one of the signature assets in the Fund, was first the recipient of BOMA’s certificate of excellence and then went on to win BOMA’s TOBY (‘The Outstanding Building of the Year’) award for office buildings in the 500,000-1,000,000 sq ft category.  This recognition is a testament to the hard work and dedication of the team and to the overall quality of the building. 

Forward Outlook

After a couple of record-breaking quarters of investment transactions, the market has paused as participants digest the implications of an evolving interest rate environment and inflation that remains well above target.   Fundamentals however are generally steady and improving as we move into the post pandemic era.  The Fund remains well positioned with a strong occupancy profile and limited rollover exposure over the next 36 months.

The Segregated Funds described in this bulletin are offered through a variable insurance contract issued by The Canada Life Assurance Company.

Please note that unit values and investment returns will fluctuate, and past performance is not necessarily indicative of future performance.

For IVIC investors: A description of the key features of the segregated fund policy is contained in the information folder.

Downloads

Latest annual report

Latest bulletin

Past Performance Reports

Quarterly Bulletins

Q2 2022 Bulletin PDF (1 MB)
Q1 2022 Bulletin PDF (2 MB)
Q4 2021 Bulletin PDF (1 MB)
Q3 2021 Bulletin PDF (490 KB)

Annual Reports

Canadian Real Estate Investment Fund - Annual Report 2021 PDF (5 MB)
Canadian Real Estate Investment Fund - Annual Report 2020 PDF (3 MB)
Canadian Real Estate Investment Fund - Annual Report 2019 PDF (5 MB)
Canadian Real Estate Investment Fund - Annual Report 2018 PDF (4 MB)
Canadian Real Estate Investment Fund – Annual Report 2017 PDF (4 MB)

Want to Invest?

Contact a Canada Life advisor to invest in the Canada Life Real Estate Fund.