Much increased investment in Calgary’s apartments and industrial properties helped make up for some of the market losses brought about by the considerably weaker office and residential segments, according to Altus Group.
On an annual basis, Calgary investment was quieter, posting a 26% decline in overall activity from the first half of 2018.
“Almost all submarkets saw a decline in total new multi-family home sales (combines townhouse and apartment) for the first half of 2019 compared to the same period in 2018, with sales during the first quarter markedly slower than the year before,” Altus stated in its latest market report.
The apartment sector’s roughly twofold increase and the industrial market’s 24% growth (with a vacancy rate of 7%) were among the positives in an otherwise modest year.
In particular, the completion of nearly 3.7 million sq. ft. of new industrial space during the four quarters ending in Q2 2019 was much welcome news. This far outpaced the less than 500,000 sq. ft. built during the immediately previous 12-month period.
However, these bright spots were not nearly enough to fully offset the 57% drop in residential land investment in the first half of this year.
Also, the new condo apartment sector is suffering from an excess of supply, “resulting in approximately 2,700 unsold units in active new condo apartment projects at the end of Q2 2019.”
A similar problem is apparent in Calgary’s office segment, “having the highest vacancy rate among the major markets in Canada (above 20%),” Altus said. “With little supply added in the past 12 months, the vacancy rate has started to decline.”