Casual commentary about political, cultural and economic issues with a particular interest on the city of Winnipeg by John Dobbin
Sunday, March 1, 2009
MPI's Purchase of cityplace
Photo of cityplace (formerly Eaton Place) by buflyer200. North of Cityplace is the MTS Centre.
There has been a lot of noise in regards to the purchase of Cityplace by Manitoba Public Insurance (Autopac).
The building where MPI has leased space for 28 years was owned by another Winnipeg company Huntington which a Arni Thorsteinson entity. As noted from the picture above, the building is nine stories tall and connected to the MTS Centre to the north. There is also an indoor parkade with 1250 spaces.
Conservatives are up in arms about the purchase. The problem is that MPI is mandated to invest money to help keep premiums down. It is allowed to own property under that mandate. Up to this point, it hasn't owned any property and even after this purchase, it will only account for 2.5% of its portfolio.
As some bloggers have pointed out, it is not unusual for pension funds or Crowns to hold investments.
There are a certain amount of risks involved in real estate but that certainly has to be mitigated by the fact the MPI rents 80% of the space already.