Commercial real estate deals surpassed records for the second consecutive year in 2017 – and are on schedule for new highs in 2018
The Canadian Commercial Real Estate market had another record year in 2017, with 2018 on pace to exceed its transaction value of $ 42 billion.
CBRE Canada 2018 Real Estate Market Outlook Report revealed that the transaction value for 2017 in 2016 was almost $ 10 billion. The report predicts that 2018 will be the third country -consecutively record high investment year.
"We have record low vacancy rates, record low unemployment, increasing institutional allocation to real estate and supportive immigration that encourages population growth," Paul Morassutti executive managing director of CBRE Canada said. "" Every year, we critically assess the threats to the Canadian commercial real estate market, but for every challenge we found, there was an even stronger reason to be optimistic about 2018. "
Canada was one of only four countries to determine back-to-back records for commercial real estate investments, states CBRE. China, Spain and the Netherlands shared the distinction.
The company believes that investors will continue to flock to the Canadian real estate market for its high-yield assets that are relatively free from the impact of the global turmoil Despite the fact that the turbulent future of NAFTA and interest rate rises are a possible deterrent, CBRE is of the opinion that the moment of investment will not quickly decline.
"When we see the effect of expected rate hikes Considered in 2018, although it increases the book value of landlords and possibly exerts a pressure on the cap rates, this will be is due to the growth in rent that our recordless vacancies will bring during the year, "said Morassutti.
The vacancy in downtown Vancouver is expected to drop to 4.9 percent in 2018, while still the lowest in the country, the second only to the 3.3 percent of Toronto.
Because office inventory is expected to stagnate until 2020, office demand is likely to increase demand and rent increases in 2018.
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