Toronto-based Allied Properties REIT (TSX: AP.UN) has reached an agreement to buy out Vancouver-based real estate developer Westbank from the M4 office building, which the two long-time partners currently co-own, according to a Q2 2025 report published by Allied on July 29.
Completed earlier this year, the M4 office building is located at 108 East 5th Avenue in the Mount Pleasant neighbourhood and is a nine-storey building with 166,800 sq. ft of office space and 38,000 sq. ft of industrial and retail space. Clad in dark glass that creates a black sheen, the building features a unique design with cubic volumes projecting from its facade, breaking from the traditional rectangular form. It is part of the Main Alley sustainable creative economy campus being developed by Westbank. Much of the building is leased, with one notable tenant being animation studio Animal Logic, which was acquired by Netflix in 2022.
The Main Alley campus will consist of five buildings. M1 is the white WeWork building located at 2015 Main Street. M2 is an eight-storey office building located at 114 E 4th Avenue that Westbank sold last year to San Francisco-based Spear Street Capital. M3 is the brown HootSuite building located at 111 E 5th Avenue. M4 is located directly across the street from M3. M5 is a planned 25-storey mass timber rental tower that's set for what is currently the surface parking lot of M1.
M4 is currently held under 110 E 5th Property Inc. and beneficially owned by Westbank and Allied Properties REIT through 2000 Main Holdings Inc. and Allied Main Alley (M4) Limited Partnership, respectively.
According to Allied, it entered into an agreement on July 29 to acquire the remaining 50% interest in M4 for a total purchase price of $89,700,000, bringing its ownership interest to 100%. The transaction is expected to close on September 30, will not involve any cash, and will instead be settled through the repayment of receivables and assumption of the full construction loan, which was secured from a syndicate of Canadian banks.
"Our long-time partner Allied acquired our interest in M4 as part of a pre-existing arrangement," said Westbank in a statement provided to STOREYS. "We're excited to continue working together bring this ambitious development to life and look forward to many more years of collaboration with Allied on Main Alley and other projects."
Allied Properties REIT and Westbank
Deloitte Summit in Vancouver (left) and Toronto House in Toronto (right), both of which are now fully owned by Allied Properties REIT. / Merrick Architecture, Hariri Pontarini Architects
This M4 transaction is the latest chapter in the long relationship between Allied Properties REIT and Westbank, which has spanned well over a decade.
More recently, the flurry of sales Westbank has embarked upon since Spring 2024 has featured many transactions involving Allied. Last March, Allied announced that it had acquired a majority interest in the Deloitte Summit office tower at 400 W Georgia Street in downtown Vancouver and the Toronto House mixed-use tower at 19 Duncan Street in downtown Toronto. Just before the end of the year, Allied then acquired the remaining interests in both projects. All in all, Allied paid a grand total of $394,961,000 for 100% of Deloitte Summit and $271,504,000 for 50% of Toronto House. (Allied already owned a 50% stake in Toronto House.)
According to Allied, it is currently in the process of finalizing a long-term lease for the last remaining office space (63,772 sq. ft) in Deloitte Summit with an "established knowledge-based organization."
Those transactions, alongside this latest transaction for M4, brings the total dollar value of the transactions the two partners have been involved in since last year to $756,165,000, although a significant portion was not settled using cash. In Toronto, the two partners are currently constructing King Toronto, a unique condo project that counts Elton John as a buyer. In Vancouver, Allied also holds a first-ranking mortgage for a credit facility up to $185 million that's registered against Westbank's 150 W Georgia Street project. The loan is accruing interest at 7.00% per annum and matures on December 9, 2025, according to Allied.
Since the beginning of 2024, Westbank has also independently sold The Pendrell to CAPREIT (TSX: CAR.UN), The Zephyr to Crombie REIT (TSX: CRR.UN), and the aforementioned M2 to Spear Street Capital. Westbank and Peterson, another long-running relationship, also sold The Lauren to Starlight Investments and, most recently, the Shangri-La Vancouver to Brookfield.
For Allied, they also completed the sale of the Boardwalk-Revillon Building in Edmonton for $20,000,000 on April 30. On July 25, Allied then sold the heritage office building at 1220 Homer Street in Vancouver for $13,250,000. The property was previously listed for sale by Avison Young.
Allied has also stated its intention to make at least $300 million in additional sales of non-core properties over the remainder of the year, and that it is highly confident it can reach that target.
