Business World

CBRE: Commercial Property Transactions in Canada to Top $40B in 2017

A commercial real estate agentCommercial property for sale in Vancouver and other parts of Canada remain in demand. Analysts expect the number of transactions to break last year’s record, according to CBRE.

The real estate services firm expects the commercial transaction to increase 15 per cent to $40 billion in 2017 from $34.7 billion year over year. Peter Senst, CBRE president of Canadian capital markets, even described the country’s market as the “Switzerland of North America.”

No Longer an Alternative

Senst believes that investors no longer see Canada’s real estate sector as an alternative investment option. The market has provided them with a haven from global uncertainty while offering attractive returns. These reasons serve as some factors behind another expected record year for the industry.

Pension funds comprise some of the most active institutional investors. They are responsible for 26 per cent of all deals worth more than $10 million. Demand from foreigners also increased. They account for 15 per cent of transactions in the same price range.

Foreign Ownership

Offshore investment activity has become not only noticeable on commercial properties, but also for private assets. However, this caused issues on foreign ownership for homes in cities such as Vancouver and Toronto.

Many argue that their involvement contributed to sky-high prices. A report, however, showed that foreigners only own a small percentage of houses in these cities.

In Vancouver, foreigners have acquired 4.8 per cent homes, while those in Toronto comprised 3.4 per cent of the all residential properties. However, foreigners own more expensive and newer houses, the report noted.

While Canada’s commercial and residential real estate markets seem to be thriving, investors still need to consult with qualified property consulting firms to find the best assets in 2018. How do you intend to invest in real estate next year?