Daily Market Update

by Jordan Maxwell31 Mar 2015
Mulroney: Canada must get creative with foreign ownership in Vancouver 
Canada's former ambassador to China, David Mulroney, has jumped into the debate surrounding foreign ownership in Vancouver's real estate market and how it affects affordability in his new book, Middle Power, Middle Kingdom. "Mainland Chinese buyers are really driving markets from Sydney through New York to London, and Canadian cities like Vancouver — particularly Vancouver — are no exception," Mulroney, who served as Canada's ambassador to China from 2009 to 2012, told The Early Edition's Rick Cluff. According to the CBC, he said it's difficult to track the actual number of foreign owners — and their impact on the housing market — but he believes it has been huge force in the lack of affordable housing in Vancouver. "Is it having an impact on price? I know there's a lively debate in Vancouver about that. I'm on the side of those who think it is having an impact on price, but that debate should continue," he said. "Really smart policy makers are thinking about ways to deal with this in ways that keep their cities welcoming — and, gosh, we want that above all — but also protect people on fixed incomes or think thoughtfully about vacancies."

Calgary industrial market to see rise in vacancies
Falling oil prices and Target’s departure from Canada will raise vacancy in Calgary’s industrial real estate sector into 2016, says Cushman & Wakefield. According to the Calgary Herald, in a report Monday, it said the vacancy rate for industrial property locally was 4.3 per cent in the first quarter of 2015, down from 7.4 per cent a year ago. More than one million square feet of space was leased during the quarter compared with 978,000 a year earlier. “With over 3.7 million square feet of new supply under construction and with nearly 0.9 million square feet firmly proposed product in the pipeline, it is expected that landlords will lose some leverage,” said Cushman & Wakefield. “This is particularly apparent in the large bay market where currently over 3.5 million square feet of product is under construction, with just one million square feet of that product pre-leased.” Despite the report, Susan Thompson, research manager for Calgary Economic Development, said the report indicates the city’s industrial real estate market remains healthy, in comments to the Herald. “That balanced three to six per cent (vacancy rate) needs to be there to allow growth and activity to occur,” said Thompson, noting transportation and logistics and manufacturing are growing in the industrial space.

“It’s not solely dependent on the oil and gas sector. Yes, in Calgary, as with everything, there is some tie to the energy sector but this one’s got a fair bit of insulation. So it would take protracted downturn to start seeing an impact in here,” she said.

Canadian real-estate players making waves in third-world
Vancouver real-estate marketers Peter Dupuis and Sid Landolt have created World Housing, the world’s first 1-for-1 real-estate gifting model, which builds housing for third-world communities in garbage dumps. The partners in S&P Real Estate Corp. are adapting a principle developed by U.S. retailer Toms Shoes, which donates shoes, water, sight repair services and birth kits to the world’s poor for every pair of shoes and other apparel it sells on its website or in its stores. According to the Financial Post, during their 32-year career, Dupuis and Landolt have designed, marketed and sold more than 20,000 condos, hotel-residences, and other premium real estate worth more than $5 billion. But in 2008 when the B.C. real estate industry fell into a lull, Dupuis decided to get his masters degree by studying housing for Canada’s urban poor. Read more of their story here

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