Allied Properties REIT Completes $197 Million in Asset Sales as Part of Deleveraging Strategy

📅 2 weeks ago

Allied Properties REIT has finalized $197 million in asset sales in Q2 2026, as the company continues its strategic initiative to reduce debt by selling non-core assets.

In a decisive move to streamline its portfolio and reduce leverage, Toronto-based Allied Properties REIT (TSX: AP.UN) has completed asset sales totaling $197 million in the second quarter of 2026, as reported in its latest financial disclosures. This amount includes the significant sale of a high-rise office building located at 1185 West Georgia Street in Vancouver, which was sold for $74 million to an affiliate of Holborn Group, a transaction first disclosed by Western Investor last month. The remaining $123 million in sales pertains to six properties situated in Toronto, all of which changed hands on June 12.
Among the notable transactions is the sale of Dominion Square, comprising buildings at 468–496 Queen Street East, which fetched $67,040,000. Originally constructed in 1878 as the Dominion Brewery, this historic site was repurposed in the late 1980s. As per Allied’s Q1 2026 report, the occupancy rates for the three buildings included within this sale were 65.3%, 75.8%, and 88.0%, respectively.
Another key sale involved 193 Yonge Street, an office building with a footprint of 51,247 square feet, which sold for $18,510,000. This historic structure, built in 1903, is strategically located adjacent to the 60-storey Massey Tower at 197 Yonge Street, a project developed by MOD Developments and others. As of the first quarter of 2026, this property was fully leased.
The sale of 257 Adelaide Street West, a six-storey heritage building in the Entertainment District, brought in $15,210,000. This building offers 37,927 square feet of office space, but as reported in Q1 2026, it was only 34.5% leased. Additionally, the Canadian Magazine Building at 200 Adelaide Street West was sold for $11,030,000. Constructed in 1913, it is recognized for its architectural significance and was 71.4% leased at the time of sale.
Further transactions included the sale of a similar-style office building at 208-210 Adelaide Street West for $4,490,000, which was fully leased as of Q1 2026, and 116 Simcoe Street, another heritage structure that sold for $6,720,000, also fully leased at the time.
In a statement regarding its ongoing disposition strategy, Allied emphasized that this initiative is critical to achieving its deleveraging goals. The company has set a target of approximately $500 million in asset sales for 2026 and is currently on track to meet this milestone, having completed a total of $243 million in sales thus far. Looking ahead, Allied is set to finalize an additional $78 million sale in the third quarter.
The REIT indicated that proceeds from these asset sales will be directed toward debt repayment, a strategic move that aligns with its broader financial objectives. Furthermore, Allied has previously indicated intentions to sell TELUS Sky in Calgary and 19 Duncan in Toronto, two prominent mixed-use towers co-developed with Vancouver-based Westbank. As of the latest report, both properties remain on the market, pending sale.

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