Morguard, a north American real estate and property management company, is forecasting a fourth consecutive year of “positive performance” in the commercial sector this year – despite the oil industry’s sluggish performance and effect on the economy.
"Investment returns will be largely income-driven, with some investors looking increasingly to new construction as a core strategy," said Keith Reading, Director of Research at Morguard. "Boosting income performance will be a focus for existing portfolios. Investors have already shown a willingness to move up the risk ladder in sourcing value-add opportunities to achieve their investment objectives."
Commercial property sales are expected to exceed $25 billion, topping the long-term average of $20.7 billion.
“Healthy and stable fundamentals will attract a range of investors armed with low-cost debt and equity capital,” an official release from the company states. “Core offerings will receive interest from pension funds, institutions, private capital groups, and capital market groups who continue to slowly return to the market. This demand will hold property values at the peak of the cycle, having stabilized through much of 2014.”
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