www.lexpert.ca/usguide-corporate/ | LEXPERT • June 2015 | 29
CANADIAN REITS
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THE PERIOD FROM 2010 through 2014 was a very active one in the
Canadian REIT sector. During this time, 30 new REITs completed their initial public off er-
ings and/or listed on a Canadian stock exchange, and a number of Canadian REITs merged
with other REITs or were taken private.
For 2015, with expectations that interest rates in Canada may stay low for an extended
period, some analysts and other market participants expect higher levels of activity in the REIT
sector and believe that opportunities for strategic acquisitions or mergers involving Canadian
REITs may increase. In addition, with the decline in the Canadian dollar over the past year, US
and foreign acquirers may look to Canada for merger and acquisition opportunities involving
Canadian REITs.
e following summary discusses some of the unique features of Canadian REITs that
should be considered in an M&A transaction and provides an overview of two common struc-
tures used to implement Canadian REIT mergers.
Overview of the Canadian REIT Market
Canada has a robust REIT market with more than 50 publicly traded real estate investment
trusts (REITs) with an aggregate market capitalization in excess of C$60 billion. Many REITs
specialize in specifi c industries – including residential, retail, offi ce, industrial, healthcare and
hospitality – while others hold diversifi ed portfolios of properties spanning several industries.
Some REITs own properties only in Canada, while others own, in addition or exclusively,
portfolios in the United States or other countries.
Unique Aspects of Canadian REITs
THE DECLARATION OF TRUST
REITs in Canada are structured as trusts and, unlike corporations, there is no general statute
governing REITs. Each Canadian REIT is instead governed by a declaration of trust, overseen
Mergers and
Acquisitions Involving
Canadian REITs
With a decline in the Canadian dollar,
American and foreign acquirers could
be looking closer at the Canadian REIT
sector for strategic M&A opportunities
BY STEPHEN PINCUS, BILL GORMAN,
AND CHAT ORTVED; GOODMANS LLP
