| BC Rail sells real estate to Concert Will focus on railway, marine businesses after unloading 16 commercial properties By Wendy Stueck The Globe and Mail, December 5, 2000 VANCOUVER -- BC Rail Ltd. has agreed to sell $79-million worth of real estate holdings to Vancouver-based developer Concert Properties Ltd. Concert will acquire 16 commercial properties from BCR Properties Ltd., thereal estate arm of BC Rail, including four office buildings and two industrial development sites. BC Rail president and chief executive officer Paul McElligott said the company plans to concentrate on its core railway and marine businesses. Owned by the provincial government, BC Rail operates a railway and shippingterminals and built up its property portfolio over the past decade. Ted Larkin, a transportation analyst at HSBC Securities Inc. in Toronto, said other rail companies have used proceeds from the sale of real estate assets to pay down debt and improve core businesses. "When you look at the privatization of [Canadian National Railway Co.], oneof the key things was to divest non-core assets and use the proceeds to modernize and enhance the main business." CN has sold interests in real estate, resources and telecommunications since it was privatized in 1995, Mr. Larkin said. Some analysts expect Canadian Pacific Ltd. will divest some of its assets in the future to focus more tightly on its energy business. Concert, an 11-year-old company owned by 23 B.C.-based pension funds, started out as an apartment developer and moved into the industrial and commercial markets in 1996. Concert was one of the companies in the running to build a new convention centre in downtown Vancouver before the project was cancelled by the province in 1999. Concert, with partner Marriott International Inc., had put together a proposal for a convention centre and a 1,000-room hotel. Tourism interests in Vancouver are now trying to generate interest and funding for an alternate proposal, but Concert is not involved. All of the properties that Concert acquired in the deal are in British Columbia with 13 in the Lower Mainland and three in other parts of the province. |