Dream Office REIT - CEO, Jane Gaven
CEO, Jane Gaven
Source: Osler, Hoskin & Harcourt LLP
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  • A significant shareholder in Dream Office Real Estate Investment Trust (TSX:D.UN) has disposed of more than 1 million voting shares 
  • Sandpiper Group, a Vancouver-based private equity firm, sold the shares on the open market for more than C$16 million
  • However, Sandpiper Group maintains the share selloff is to generate capital and not due to Dream Office’s recent market performance
  • As a result of COVID-19 ongoing economic impact, Dream Office’s market share has fallen by more than half since the beginning of March
  • Dream Office Real Estate Investment Trust (D.UN) is up 11.25 per cent, with shares trading at $17.01 and a market cap of $957.2 million

A significant stakeholder in Dream Office Real Estate Investment Trust (TSX:D.UN) has disposed of more than 1 million voting shares in the company.

Dream Office owns properties surrounding Canada’s urban centres, particularly in downtown Toronto.

Sandpiper Group, a Vancouver-based private equity firm, previously held an approximate 10.1 per cent voting share in Dream Office.

However, as of today, Sandpiper has disposed of around a tenth of its shares to raise capital due to the recent market turndown.

The shares were sold on the open market at a price of C$16.10 each, and are cumulatively worth more than $16 million.

The share sell-off reduces Sandpiper’s voting rights to around 8.5 per cent.

Samir Manji, Sandpiper’s CEO, was quick to assure the public that the company still has faith in Dream Office’s future prospects

“Our conviction on Dream Office has not changed. We continue to see deep value in the underlying real estate of the REIT.

“Selling a portion of our ownership position in Dream Office was a capital allocation decision. The world will get through the COVID-19 crisis and we believe quality downtown Toronto office real estate will remain in demand for the foreseeable future,” he added.

Samir’s comments suggest that Sandpiper was more concerned with its liquidity amid the market downturn, rather than Dream Office’s performance.

That said, Dream Office stated last week that it is too early to say whether the company will be heavily impacted by the COVID-19 pandemic.

However, the impact that self-isolation and travel bans have had on the Dream Office’s market share can already be seen.

Since the beginning of the month, Dream Office’s share price has dropped by more than half. This is devastating for a company with a market cap previously well over $1 billion.

Despite this, Dream Office stated that its $414 million in liquid assets position the company well for the coming months.

Dream Office Real Estate Investment Trust (D.UN) is up 11.25 per cent, with shares trading for $17.01 at 4:00pm EST.

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