2017 is set to become a stable, strong year for Canadian commercial real estate, as the sector will continue to magnetize investors with its rich opportunities for investment, according to a real estate firm’s recent analysis.
In a CNW press release last week, Morguard predicted that the Canadian commercial market will prove to be a haven for those who are seeking relatively stable yields, as key sectors continue to post robust figures and activity levels.
“The financial and technology based economies of British Columbia and Ontario will drive real estate investment,” Morguard stated in its release. “In contrast, markets supported by the resource sector, which have been negatively impacted, are expected to improve gradually over time”
“Canadian investment transaction volume surged this past year reaching $27.4 billion in total over the first three quarters of 2016, compared with $16.9 billion over the same period in the previous year. Annual 2016 sales are projected to surpass the most recent annual peak of $32.1 billion in 2007,” the company added.
A growing need to spread risk via diversification will fuel much of the movement, which Morguard officials noted would have the side benefit of strengthening the performance of Canada’s finance and tech-based sectors.
“For many domestic and foreign investors, Canada's commercial property market represents stability over the long term resulting in a willingness to place capital in this market,” Morguard director of research Keith Reading said. “This sector has a solid record of performance which we anticipate will continue to drive investment decisions, against a backdrop of global political uncertainty.”
Variable-rate mortgages becoming more important to the market - study
Higher short-term interest rates not expected until 2018, analyst says