Interest Rates Low for Q3 in Vancouver, BC
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Capital Park Project Underway in Victoria, B.C.
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(Posted on Nov 14, 2018 at 07:57PM by Michelle Bogle)
Construction is about to commence on the new Capital Park Residences, which is part of a $250-million multi-phased mixed-use project behind Victoria’s legislature in the James Bay neighbourhood.Â
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The development is a partnership between Concert and Jawl Properties. The two companies bought the site (near Superior, Menzies and Michigan streets) in 2014 for $34 million when the province was selling land. Previously, it was used for old provincial offices and parking.Â
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A total of 113 homes are expected to be finished by early 2021 and will comprise of condominiums in five-storey and four-storey buildings, as well as seven townhouses. Condo prices range from $499,900 to $1.09 million for 485 square feet to 1,759 square feet units, while the townhomes will start at $1.489 million and offer 1,451 to 1,757 square feet of space.
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Twenty years ago, the Victoria Accord planning agreement was established for the area, which visualized a mixed-use approach. Goals of the accord included the development fitting in with the James Bay neighbourhood and the nearby legislature building, opening up the area with public access and amenities, and to preserve views. Today, that vision is becoming a reality as a second office tower of 120,000 square feet is slated to finish late next year.Â
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Currently, the site is also home to a 127,000 square foot office complex, which houses provincial staff. A Red Barn Market is open, along with a new library branch. Tenants have moved into 53 new rental apartments and a set of three heritage homes house 13 rental apartments. Much of the large public plaza is complete as well.Â
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To learn more about investment opportunities in Victoria’s James Bay neighbourhood or ongoing mix-use projects within the development, please contact our Vancouver office to speak with a Marcus & Millichap commercial real estate advisor.
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Vancouver Retail News: Lowe’s Closing Stores Across Canada and U.S.
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(Posted on Nov 14, 2018 at 07:32PM by Michelle Bogle)
Earlier this month, home improvement chain Lowe’s announced the closure of 51 stores in the United States and Canada as it strives to compete with rival Home Depot in a slowing housing market. Of those 51 stores, 31 are Canadian with one closure occurring in British Columbia. Lowe's also plans to close its block plant in Kamloops.
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It has been a trying last few quarters for the retailer, being hit especially hard by longer winters in North America and increased housing prices. Consumers are also spending less on housing, which has directly impacted the home improvement sector. The closures also follow a wave of similar moves by traditional retailers in the face of greater competition from Amazon and other mass online outlets.
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Sylvain Prud'homme, Chief Executive of Lowe's Canada, said the changes will allow the company to improve collaboration between its banners to better serve customers. “Everything will be done to ensure a smooth transition until the stores are closed, and Lowe's Canada will support impacted employees, including by transferring eligible employees to other locations within our network whenever possible,†he shared in a statement.
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The company, which operates about 1,800 U.S. stores and 300 in Canada, said it expects the closures to be completed by February, with the exception of some stores south of the border that will terminate immediately.
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To learn more about this closure and how it may impact the Canadian retail asset class, please contact our Vancouver office to speak with a Marcus & Millichap commercial real estate advisor.
Commercial Real Estate is Stable in Vancouver, BC
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(Posted on Nov 11, 2018 at 04:44PM by Danielle Smyth)
In a recent report, Marcus & Millichap analysts have reported that stock market volatility has not had a negative impact on commercial real estate. Instead, they indicate that the stability of commercial real estate is “increasingly appealing for investors.†You might wonder why this is the case. Well, they explain, “carrying competitive yields and relatively less volatility, commercial real estate represents a viable alternative to equities. Additionally, property values typically reflect the economic strength of the real economy, underpinned by low unemployment, positive demographics and continued growth in consumer spending, reinforcing a healthy outlook for the coming year.â€This is great news for anyone considering an investment in commercial real estate. The report further suggests that commercial leases align quite well with the rise in inflation. Over the past 12 months, core CPI has risen 50 basis points to 2.2 percent. In addition, many commercial leases tend to have built-in clauses that speak to inflation adjustments or lease resets, so that investors can deflect the costs that might be associated with an increase over time.
If you’re interested in learning more about opportunities for investment throughout Canada or how economic changes might impact you, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
Rental Properties Win Big This Quarter in Vancouver, BC
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(Posted on Nov 11, 2018 at 04:35PM by Danielle Smyth)
According to a recent report, home sales have slowed in Canada. Though the 30-year mortgage rate has remained low, it has increased since 2011, reaching its highest level in those 7 years. As a result, much of the demand in the housing market has shifted towards apartments and rental units. Clearly, this is great news for commercial real estate investors who might be considering the purchase of such properties.Analysts from Marcus & Millichap report that the median price of an existing single-family home as of August 2018 is $267,300. They anticipate that there are 4.3 months of stock, assuming that things continue on pace as they have been. The monthly mortgage payment for a home is now $339 more than an average monthly rent, which could further encourage potential buyers to rent instead.
Furthermore, continued job growth is leading to the formation of more households. However, demand is concentrated in apartments. As a result, there are fewer and fewer multifamily units available. The report states that “Nationally, nearly 82,900 units were constructed in the third quarter, but the positive absorption of more than 107,000 units pushed down the third quarter apartment vacancy rate 40 basis points from the previous quarter to 4.2 percent, the lowest level since 2001.â€
If you’re interested in learning more about opportunities for investment throughout Canada, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
Great News for Vancouver, BC, Commercial Real Estate Investors
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(Posted on Nov 11, 2018 at 04:22PM by Danielle Smyth)
A recent report on updates to the market in Vancouver revealed some great news for Canadian investors. For instance, on the whole, the nation saw an overall growth of 2.5%, annualized, year-over-year. In addition, when it came to office space, finance- and insurance-related companies saw gains of about 1.0 percent. General real estate was also up, seeing a 0.3 percent increase largely tied to home sales. Professional services saw similar gains.According to CoStar Canada, “The  office, industrial and retail commercial real estate markets in the [Greater Vancouver Area] remain deeply embedded in favour of landlords.†They spoke further to the increased demand from companies like Amazon, as well as co-working companies, all of whom are seeking office and warehousing space in the Vancouver region. The market assessment further stated that, despite “an additional 2.4 million SF of retail space currently under construction, due to low vacancy and relatively consistent demand, rental rates are expected to continue rising.â€
All of this is excellent news for investors, who should take the leap now if they wish to grab hold of some amazing opportunities in Vancouver. Don’t miss out on this wonderful chance! If you’re interested in learning more about opportunities for investment, contact Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to help you!
Commercial Real Estate Property Tax Ratios in Vancouver, BC
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(Posted on Nov 10, 2018 at 08:57PM by Danielle Smyth)
The commercial real estate property tax ratio is high in Canada, says a recent report. In fact, commercial taxes are almost three times as high as property taxes. In Vancouver, the ratio is even higher, at four to one. This is in spite of the fact that the city had the largest decrease, of 9.72 percent, and the largest drop in its commercial tax rate, at 12.78 percent. This is because commercial real estate values increased at a higher rate than residential values.According to the article, Vancouver remains a hot market for commercial real estate. This is great news for investors. Having a sizable tax base of commercial buildings in the city is a wonderful thing, as it encourages growth and makes the city seem like a great place for businesses to move. Toronto, also, is doing very well in this regard and remains a wonderful place for investors.
If you’re interested in learning more about opportunities for investment throughout Canada or about how commercial real estate property tax ratios can be beneficial for you, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
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Bidding Wars in Kitimat are Great for Vancouver, BC, Investors
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(Posted on Nov 10, 2018 at 08:37PM by Danielle Smyth)
In Kitimat, bidding wars on commercial real estate are creating soaring rents. This is all a result of the fact that the LNG Canada project was recently approved. The $40 billion liquefied natural gas pipeline is going to make a huge impact on the market throughout the area.Since the October 1 approval of the pipeline, rents and prices in home sales have soared. For instance, the average house price in the area has jumped to $256,500, up from $214,800 a year ago. Virtually no housing has been built in the area in recent years, and a whopping 42% of apartment units are vacant. This is good news for real estate investors, though, since rents could now be set at much higher levels in those properties.
Investors in the Kitimat area are being cautioned to move quickly if they want to get in on these fabulous opportunities, because homes and units are selling so fast. Don’t miss out on this wonderful chance! If you’re interested in learning more about opportunities for investment while there’s still time, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
Vancouver, BC's New Mayor to Tackle Housing Crisis
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(Posted on Nov 10, 2018 at 08:25PM by Danielle Smyth)
Kennedy Stewart, the new mayor of Vancouver, has vowed to tackle the housing crisis immediately. The city’s first independent mayor in over 30 years, he campaigned on a promise of building 85,000 units of non-profit, rental, and market housing over the course of the next ten years. In addition, Stewart has sworn to triple the empty-homes tax and protect as much as one-half of the homes in the city from foreign speculation.Stewart was quoted as saying that he is frustrated by the possibility that a company might “operate a business for 30 years in one location and they rezone your area or a development permit gets approved, the building won’t be built for five years, but your commercial property taxes go through the roof, and because of the triple-net lease, you’re responsible for them.†As such, he is hoping to look at assessments on commercial properties.
All of this is could be good news for investors in the long run, as policies shake out and encourage growth of business in the city. Curious how trends like these might ultimately affect the market in Vancouver, BC? Get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
Abbotsford-Mission, B.C. Named Third Region for Best Investment Opportunities in Western Canada for 2019
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(Posted on Nov 7, 2018 at 08:53PM by Michelle Bogle)
In a recent report by Western Investor, two neighbouring cities – Abbotsford and Mission – were named in the third top spot for best real estate investment opportunities in Western Canada for 2019. Located on the edge of the Lower Mainland, this region is proving popular with both residential and industrial investors.
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Part of the appeal in Abbotsford-Mission is affordability. More people from Metro Vancouver are infiltrating the area looking for work and housing. As of September, 1,567 new homes were under construction, including nearly 300 new detached houses, which sell for an average of $843,900.Â
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On the commercial front, Abbotsford’s industrial vacancy rate has dipped to 1.8 percent this year, which makes it the lowest in the Lower Mainland. The industrial lease rate is also sitting at an average of $9.17 per square foot. Investors particularly like this city for its robust infrastructure, award-winning cancer hospital and the fourth-busiest airport in Canada. It is also the agriculture capital of the country, grossing farm receipts three times those of Ontario’s Niagara region, which sits in second place.Â
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According to Western Investor, Mission is being poised as the next industrial destination. The district has great freeway and U.S. border access, which is ideal for distribution facilities. Currently, there are two main industrial parks in the area: Mission Industrial Park, which is primarily light industry, warehouse, office use and retail, and Silver Creek Industrial Park, which has direct railway and Fraser River frontage for heavier industrial operations.
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If you’ve been considering an industrial, agriculture or land commercial real estate investment in Abbotsford or Mission, please contact Marcus & Millichap’s Vancouver office to speak with one of our experienced asset-focused advisors.
East Vancouver Multi-Level Commercial-Industrial Building is Underway
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(Posted on Nov 7, 2018 at 08:48PM by Michelle Bogle)
Construction is underway for a new mixed-use commercial and industrial building on the northeastern corner of Vancouver within the waterfront area. PortLiving, a local developer, says that its Gateway project is a “first-of-its-kind vertical typology†with its diverse uses of office, light industrial and mini-storage space.
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Located at 3333 Bridgeway Street and designed by Stuart Howard Architects, the building will offer 110,000 sq. ft. of space within the 70-ft-tall, six-storey building. Unlike traditional industrial buildings, which use a single-level layout, the design of Gateway is different in that it stacks light industrial uses within a multi-storey building.
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“By going vertical with industrial space, we believe that we are developing fantastic space that can be leased at reasonable market value to help businesses stay and thrive in [the city],†said Tobi Reyes, CEO of PortLiving, in a statement. “This is an incredible site that provides an affordable Vancouver business address that is easily accessible and convenient between [...] the North Shore, Burnaby and beyond.â€Â
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The exterior of the building features a unique curved façade, which was inspired by salmon swimming upstream. It also boasts a large cantilevered landscaped rooftop, offering panoramic views of the inlet, downtown skyline and North Shore mountains. Its facilities are well-suited to artists, television and film production companies, construction trades showrooms, coffee roasters, music studios and commissary services.
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With industrial space in high demand across Metro Vancouver, this project will inject some much-needed square footage into the market by its completion date in early-2020.
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If you’d like more information about this multi-level commercial-industrial building, please contact our team of experienced investment professionals at our Marcus & Millichap Vancouver office.
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