GO Residential Real Estate Investment Trust shares fell as much as 3,3% on Friday morning following the $410 million Initial Public Offering, which was the first corporate IPO at the Toronto Stock Exchange since 2025.
Despite an early decline, this offering represents a significant reopening for Canada’s IPO Market, which had been largely silent since the end of 2024.
The New York-based investment company’s shares were initially priced at $15 per share, but they were currently trading for $14.50 in Toronto as of 9:44 a.m. This is a slight drop below the IPO.
Canadian Imperial Bank of Commerce, Bank of Montreal and Canadian Imperial Bank of Commerce led the offering of 27,34 million units.
The REIT now trades under the ticker symbol “GO.U” on the Toronto Stock Exchange.
The TSX will host its first major IPO in 2025.
GO Residential is the only corporate IPO to be listed on TSX in this year. It’s also the first deal that has raised more than $50m since Groupe Dynamite Inc. offered $215m back in November 2024.
This could be a sign of a possible revival on the Canadian capital market after a prolonged lull.
Bloomberg News reported that the offering had been significantly oversubscribed. The majority of allocations went to institutional investors who only held long positions, reflecting a strong demand in spite of a cautious market.
A private placement in connection with the IPO saw funds managed by Cohen & Steers Capital Management Inc. agree to buy 6 million units for the price of the offering, bringing an extra $90million to the table.
The move is a further indication of the confidence that institutions have in GO Residential and its portfolio.
New York residential real estate: a focus on the high-end market
GO Residential REIT owns a luxury portfolio of high-rise apartments in New York City.
The prospectus states that the proceeds of this IPO would be used for these properties.
In one of the most competitive markets in real estate, REITs are aiming to create a steady income stream by renting out premium assets.
This company intends to distribute cash monthly, which equates to a yield annually of about 4.26%.
According to the announcement, September 15 is set as the date for distribution.
Meyer Orbach is the chairman of GO Residential and a co-owner of NBA Minnesota Timberwolves.
Joshua Gotlib, the Chief Executive Officer of the REIT, previously headed Manhattan-based Black Spruce LLC. He brings a wealth of experience from the New York real estate market to its leadership team.
The IPO syndicate also included major North American investment banks, including Bank of America Corp. and BMO. Other members of the IPO consortium were Royal Bank of Canada and National Bank of Canada.
Although the REIT debuted with a small drop in price, its strength, investor interest and size of the transaction mark an important step forward for Canadian equity markets.
Investors are now watching GO Residential’s performance in public markets, and its ability to deploy capital effectively in New York’s competitive real estate market.
The post GO Residential REIT Drops on Debut after Oversubscribed $410M IPO might be updated as new developments unfold.
