Interest Rates Low for Q3 in Vancouver, BC
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Terrace Named Second Top Investment Town in Western Canada for 2019
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(Posted on Nov 7, 2018 at 08:43PM by Michelle Bogle)
Just a half-hour-drive away from Kitimat’s new $40 billion liquefied natural gas (LNG) terminus and pipeline network is Terrace, B.C. This land-rich city was recently named the number two best investment town in Western Canada for 2019 by Western Investor – a city that we will be a staging site for LNG Canada’s neighbouring plant.
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According to Danielle Myles, Manager & Economic Development for the City of Terrace, the selling point of the area is the availability of land. Historically, major industries and investors have flocked to the area and that trend that will continue with the development of the LNG plant. Terrace is also home to an airport and an extensive retail industry, which has helped the city earn its spot as a major trading centre for northwest B.C.
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And while investment in Terrace is expected to rise with the advent of the bordering Kitimat LNG, this growth isn’t new to the region. Over the last two years, commercial building permits in the city have increased by nearly 300 percent. The residential housing market has also experienced growth – the average price of a detached house in town averages $337,000, which is up 18 percent from one year ago.
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If you have your eye on land or other commercial real estate assets in Terrace, B.C., the time to act is now. Please contact our Vancouver office to speak with a Marcus & Millichap investment specialist to learn more.
Industrial Demand Drives Land Prices Up in Metro Vancouver
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(Posted on Nov 7, 2018 at 08:39PM by Michelle Bogle)
The Metro Vancouver industrial market continues to experience vacancy rates well below the fiveâ€year average of 2.6 percent. According to a recent Real Estate News Exchange article, there are approximately only 20 months of industrial supply based on present vacancies and premises under construction.Â
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Currently, there is 3.1 million square feet of space in Metro Vancouver being built on spec, along with an additional 11.49 million square feet either under construction or planned without lease commitments. Three notable projects include the Tsawwassen First Nation lands near Deltaport, Onni’s Golden Ears Business Park and Oxford’s Riverbend Business Park.
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Q3 2018 also saw the completion of Delta iPort’s Building 1, which Amazon has leased 454,000 square feet to be used as a fulfillment centre. Campbell Heights West Business Park’s Building 200 also added 202,105 square feet to the industrial market, along with Delta Link Business Centre Phase II with 133,765 square feet.
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With supply of industrial land dwindling, especially larger parcels that are ideal for major distribution centres, space of this scale is becoming scarce and driving land prices up across the region. Over the last six months, industrial property sales across Metro Vancouver hit $747 million, but this is expected to increase by an additional $347 million as in-progress deals continue to close. The sale of industrial land is currently sitting at an average price of more than $5 million an acre. Â
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And, investors are taking note. In fact, many residential investors are moving into the industrial sector, being lured by increased demand, sustaining market prices and handsome returns. Competition is fierce, which means that the time to act is now.
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To learn more about Vancouver’s burgeoning industrial market, please contact our team of asset-focused commercial real estate advisors at Marcus & Millichap’s Vancouver office. Â
Kitimat, B.C. Tops List of 2019 Best Investment Towns
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(Posted on Nov 7, 2018 at 08:32PM by Michelle Bogle)
Low Unemployment Increases Demand for High-End Apartments in Vancouver, BC
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(Posted on Nov 7, 2018 at 07:20PM by Danielle Smyth)
According to a recent report by Marcus & Millichap, ever-decreasing unemployment numbers in the United States, especially among the college educated, have led to a higher demand for upscale apartments. In fact, in the U.S., unemployment numbers are now under 6 million, making them the lowest they’ve been since December 2000. For those with a four-year college degree, the jobless rate dropped 2.0 percent, its lowest level since 2007.This is great news for investors considering the purchase of high-end apartment buildings. In particular, multifamily buildings and excellent quality properties, like Class A and B apartments, tend to thrive in an environment like this. In the past 20 years, when the unemployment rate for college educated individuals fell to the levels they’re currently at, the vacancy rate for Class A apartments has historically dropped below 5 percent.
Curious how trends like these might be impacting the market in Vancouver, BC? Our advisors have the expertise to help you understand evolving aspects of the economy to ensure the best possible outcome for your investment. If you’re interested in learning more about opportunities to own property 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.
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CACs and Real Estate Investing in Vancouver, BC
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(Posted on Nov 5, 2018 at 01:50AM by Danielle Smyth)
Rezoning in Vancouver is a complex process that involves decisions on a variety of fronts. Anytime the city approves a request for rezoning, it “aims to capture 70 to 80 percent of the uplift in land value created by that rezoning through “Community Amenity Contributions,†or CACs,†according to a recent report. The reason behind this? The city feels (and many residents agree) that developers should have to contribute to the amenities that residents make use of as their way of giving back to the community that brings them business.In many instances, the city has been criticized for approving rezoning requests when they shouldn’t have for reasons solely based on getting more funding for these improvement projects that are essential to residents. However, if you don’t get CACs, the taxes of those who live in a given area will by necessity go up.
What does this mean for developers and investors? They should be prepared for the cost of CACs, as well as for all of the benefits these can have on the neighborhoods they are entering. Vancouver is a booming market and definitely worthwhile for investment, so the cost of helping to build up the community is in most instances well worth it.
If you’re interested in learning more about opportunities for investment, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide all of the information you need.
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New Retailers to Canada Create Exceptional Opportunities for Vancouver, BC, Real Estate Investors
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(Posted on Nov 5, 2018 at 01:38AM by Danielle Smyth)
According to a recent report, 2018 could leave as its legacy a huge mark as being a wonderful year for investors. This is because it continues to exceed expectations as far as new retailers coming to Canada. In fact, it’s shattering records set in 2017, which was already viewed as an impressive year.According to a publication that is well-trusted in the industry, called Retail Insider, at least 50 new companies arrived in Canada in 2017 in the retail market. As of July of this year, there were already 30 additional companies, leading to the theory that 2018 will close out with another record-breaking total.
Apparently the majority of international retailers who come to Canada are choosing Toronto or Vancouver as their first sites in the country. A whopping 34 percent of new companies were luxury brands. There were also a great deal of coffee shops, restaurants, and eyewear businesses that made the move, each about 12 percent of the total.
This is wonderful news for investment real estate opportunities, particularly in Vancouver, which is such a hotbed for activity. 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.
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The Real Estate Market in Vancouver, BC, is On the Mend
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(Posted on Nov 5, 2018 at 12:31AM by Danielle Smyth)
According to a recent report, the real estate market in British Columbia still remains bullish, despite slow September home sales. According to the British Columbia Real Estate Association (BCREA), the “downturn is largely behind†the industry, and things should be picking up soon.Though drops were seen across the board, they varied depending on geographic location to a great extent. For instance, there were declines of 50 percent in Chilliwack and the South Okanagan. However, in the Greater Vancouver area, there was a decline of 43.3 percent, and only 16.7 percent in Victoria. In Northern B.C., there were only losses of about 9.5 percent, and a meager 5.4 percent in Powell River.
Based on the article, it does not appear that the commercial or investment real estate sectors have seen hugely negative impacts from the market trends. Cameron Muir, the chief economist for BCREA, said “My expectation is for sales over the next couple of quarters to trend higher, as long as the B.C. economy stays where it is. All our models are pointing in that direction looks like we’re in the trough of the chart.â€
This is good news for those who might wish to invest in real estate across the market in Canada. Interested in getting involved? Get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to assist you!
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Toronto Investment Firm Buys Vancouver Office Building for $225 Million
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(Posted on Oct 31, 2018 at 08:23PM by Michelle Bogle)
Toronto-based Crestpoint Real Estate Investment has acquired a Class A office building for approximately $225 million – more than $1,000 per square foot. The 19-story building with five ground level retail units, located at one of Vancouver’s busiest intersections at the corner of Robson Street and Burrard Street, was previously owned by Oxford Properties and CPP Investment Board. The office building is fully leased to the Canadian government while the retail component is leased to brandâ€name national and international tenants, including Lululemon.Â
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This deal follows after Crestpoint recently acquired a 53 percent stake in a similar office property in Montreal. That building sold for $300 per square foot, or less than a third of what they paid for 800 Georgia Street in Vancouver.
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According to Kevin Leon, President of Crestpoint, the price discrepancy between the two markets relates to liquidity. “In downtown Vancouver, there is a limited supply of land, and it's very attractive to foreign capital,†said Leon in an interview. “There will always be an exit price if the market goes south. Right now, the market in Montreal is great, but sometimes you can't sell a building.â€
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For more information or insight into this recent benchmark sale or to discuss office investment opportunities across the Lower Mainland, please contact us at Marcus & Millichap to speak with a commercial real estate advisor.
Report: Vancouver Remains a Primary Destinations for Investors
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(Posted on Oct 31, 2018 at 08:18PM by Michelle Bogle)
According to a recent report, the strength of Canada’s investment market is proving very strong for 2018 with sales data appearing exceptionally good in Vancouver.Â
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Looking back to Q2 2018, commercial real estate transactions hit a record $16.5 billion across the country with Toronto attracting $5.7 billion worth of deals and Vancouver accounting for $3.2 billion.
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In B.C., two major investment trusts are responsible for driving nearly half the national volume in the second quarter – Canadian REIT, who owns 1185 West Georgia and 1508 West Broadway, and Vancouver-based Pure Industrial Real Estate Trust. The purchase of Investors Group’s nine office properties in Metro Vancouver was also a driving factor in significantly increasing local investment volumes, along with growing suburban office deals outside of the city’s centre.
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The market has proven to be as busy as ever – and the pipeline of transactions continues to show signs of benchmark numbers for the remainder of the year. Apartment properties are steadily gaining investor demand, and this trend is likely to continue with the province’s recent announcement of a 4.5% annual allowable rental increase for 2019.
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If you are an investor looking to gain a foothold in Vancouver’s prime commercial real estate market, please contact our team at Marcus & Millichap to speak with an investment sales and financing professional.
Canadian Real Estate Investments Hit a Record High, Especially in Vancouver, BC
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(Posted on Oct 29, 2018 at 03:56PM by Danielle Smyth)
It’s a good time to be involved in the Canadian real estate investment market. In fact, a recent report reveals that transactions hit a record high in the second quarter of 2018. The writer believes that this was largely driven by two major deals and the “continued strength of the Toronto and Vancouver markets.â€Across the country, deals totaled $16.5 billion, which marks a 38 percent increase from the previous record of $12 billion in the first quarter of 2017. Vancouver and Toronto have seen a huge amount of interest by investors, and they have had the least vacancies of any downtown areas for the past four quarters. In addition, the cities have been the two with the lowest industrial availability for a year and a half. Toronto made up a third of all transactions and had a total value that was 82 percent above the five-year average.
At this point, investors are more interested in high-quality properties, which are a far safer bet in the event that there were to be an economic downturn of some kind in the future. If you’re interested in learning more about commercial real estate opportunities throughout Canada, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors is ready to answer any questions you might have!
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