Thank you, Madam Speaker. In light of Starlight Investments and KingSett Capital's recent intention to purchase Northview Real Estate, thus making the two largest landlords in Yellowknife. One, I wanted to read an open letter to CEO Jon Love of KingSett Capital and CEO Daniel Drimmer of Starlight Investments.
Congratulations on your intention to purchase Northview Real Estate Investment Trust for $4.8 billion. I wish to inform you that, upon closing this deal, you will own a small city in the subarctic called Yellowknife.
Yellowknife also happens to be the capital city of the Northwest Territories. I invite you to come and visit sometime. It's a beautiful place. In case you were not aware, Northview presently owns the majority of rental apartment units in Yellowknife, and when combining their commercial stock with KingSett's current Yellowknife stock, you will own the majority of commercial leasing space, as well. I have attached a picture of our downtown core to show you all the buildings you will own, one of which KingSett has managed to keep vacant for almost a decade. It recently had its siding fall off; I have attached that picture for you, as well.
Additionally, congratulations on your intention to purchase a company which is our city's leader in residential tenancies violations. When you come visit our town, I hope you will visit the various Northview apartments that have been left in disrepair due to rent money flowing south to fuel other capital investments. Before you purchase our city, I wanted to ensure that you are aware of the fact that the majority of Yellowknifers have, at some point, lived or worked in one of the buildings in this deal, and I have yet to ever hear a single positive thing about that fact.
My apologies, Dan. I know you have significant amount of investment in Northview, but I hope, as our new landlords, we can start a fresh and do some work to repair the relationship with our residents.
Now I recognize that by design real estate is first and foremost an investment for your companies and the fact that people live and work in your property is secondary; but I would hope you both put something extra in for exceptional cases such as this.
As I am sure you are aware the North is an exceptional market. The capitalization rate for Northview's Northern Canada holdings is 9.17 percent which is 55 percent higher than its overall capitalization rate and 40 percent higher than its next most profitable region. Of course KingSett, as a private equity fund for institutional and ultra-high net worth investors, does not have the transparency of an exchange-traded REIT like Northview, such that similar information is not publicly available for Kingsett's current holdings in northern Canada.
Madam Speaker, I am seeking unanimous consent to conclude my statement.
---Unanimous consent granted
I also note that Northview's current market power, combined with Kingsett's market share, is an index that will make Yellowknife one the most highly concentrated real estate markets in Canada.
Dan, Jon, we all know this deal is not really about Yellowknife. There are so many assets in your combined multi-billion-dollar portfolios that I wouldn't expect you to ever know them all by city. I am hopeful that this letter, despite its sarcastic tone, can start a conversation. There are a variety of remedies available that will ensure the acquisition of Northview can allow some competition to once again exist in our northern capital. I have brought this market share issue to the Competition Bureau of Canada's attention on multiple occasions. I encourage you to reach out the them and divest some of Yellowknife assets in this deal, ideally on a small enough scale to allow local ownership in a city which is desperately in need of competition and local developers. At the very least, perhaps you could try and do something about that 10-storey vacant tower that you own.
Yours truly, Rylund Johnson, MLA for Yellowknife North.