Small and medium-sized businesses are driving an industrial real estate recovery in Burnaby, says a new Avison Young report.
Broker Kyle Blyth, who specializes in Burnaby industrial sales and leasing transactions, says small and medium-sized companies are helping to maintain the Vancouver suburb's traditionally stable conditions. Traditionally, after a downturn, he says, smaller industrial owner-users re-enter the market first and then larger companies come back.
Although Burnaby vacancy has notched up to 3% from 2.6% in the fall of 2009, it is still well below the Metro Vancouver average of 4.7%. Older properties needing renovation or redevelopment have slightly skewed Burnaby's rate upward.
But properties with high ceilings, good visibility and exposure, and easy access to arterial routes are in high demand. Meanwhile, landlords, well educated on market conditions, are offering new tenancies or retain existing ones.
Existing tenants will likely be able to capitalize on more favourable lease rates as they act on long-term needs that have been put off pending the global economic recovery.
In the few cases where developable land is available, developers will be asked to pay a premium. Lawrence Green, president of Spire Development Corporation can relate.
His company paid $1.4 million per acre for land where the new Spire Corporate Centre on North Fraser Way is located.
According to Blyth, strata-ownership projects, which help offset high land costs, are likely to increase. As the report notes, the Beedie Group, is also developing strata projects in South Burnaby.
Notable leases include Core-Mark International renewing on 70,000 square feet (sf) at 7800 Riverfront Gate while Mustang Survival (45,000 sf), Japan Foods (40,000 sf), Dynamex Couriers (30,000 sf) and Shoppers Home Health Care (20,000 sf) inked new rental agreements.
Thursday, May 27, 2010
Tuesday, May 18, 2010
Metro Van Comissioner to discuss growth strategy
Metro Vancouver commissioner Johnny Carline will look into the region's distant future during this month's NAIOP Vancouver breakfast meeting.
Carline will provide an overview of the Metro Vancouver Regional Growth Strategy during the NAIOP event May 26 at the Hyatt Regency.
A draft of the plan, entitled Metro Vancouver 2040: Shaping Our Future, has been out since last November and is now undergoing reviews by various stakeholders and other groups.
The draft says Metro Vancouver's vision for the future will be achieved "by embracing and applying the principles of sustainability, not least of which is an unshakeable commitment to the well-being of current and future generations and the health of our planet, in everything we do."
Carline, also the region's chief administrative officer, has strived to be a strong voice in the sustainability movement. Since taking up his post in 1997, he has launched the award-winning Sustainable Region Initiative (2001), which NAIOP's e-mail blast on the breakfast notes, made the sustainability movement "a political fact of life" in Greater Vancouver.
Metro Vancouver is the regional governing body for the local metropolitan area and its two million inhabitants. The group's responsibilities include water, sewer, drainage and solid waste management systems as well as regional growth management, air quality, regional parks and affordable housing.
Here's a link to the planning document: http://ow.ly/1MPqM.
Carline will provide an overview of the Metro Vancouver Regional Growth Strategy during the NAIOP event May 26 at the Hyatt Regency.
A draft of the plan, entitled Metro Vancouver 2040: Shaping Our Future, has been out since last November and is now undergoing reviews by various stakeholders and other groups.
The draft says Metro Vancouver's vision for the future will be achieved "by embracing and applying the principles of sustainability, not least of which is an unshakeable commitment to the well-being of current and future generations and the health of our planet, in everything we do."
Carline, also the region's chief administrative officer, has strived to be a strong voice in the sustainability movement. Since taking up his post in 1997, he has launched the award-winning Sustainable Region Initiative (2001), which NAIOP's e-mail blast on the breakfast notes, made the sustainability movement "a political fact of life" in Greater Vancouver.
Metro Vancouver is the regional governing body for the local metropolitan area and its two million inhabitants. The group's responsibilities include water, sewer, drainage and solid waste management systems as well as regional growth management, air quality, regional parks and affordable housing.
Here's a link to the planning document: http://ow.ly/1MPqM.
Monday, April 12, 2010
Richmond Q1 industrial dollar volume exceeds $60 million
Richmond's industrial property sales and leasing activity is on the rise.
According to a new Avison Young report, industrial real estate sales and lease deals in Metro Vancouver's largest submarket have rise dramatically from about this time last year. (Disclosure note: your agent was involved in preparing the report.)
In the first quarter of 2010, Richmond industrial investment dollar volume surpassed $60 million compared to only $3 million a year earlier, when global markets were still caught in the recession.
IKEA's acquisition of Key West Business Centre for $35 million spiked the dollar volume in the first quarter of this year, but the market still displayed underlying strength as deals tripled to nine from three in the first quarter of 2009.
Meanwhile, vacancy is hovering around 6%, but supply remains relatively tight due to limited available new and existing industrial inventory. Tenants should be able to capitalize on large inducements to renew existing lease agreements or sign new ones.
In some cases, landlords are offering several months of free rent in exchange for long-term lease agreements.
The report also details recent sales and leasing transactions and updates readers on phase II of Farrell Estates Ltd.'s Shelter Island project.
To access the report, click on the this link:
http://ow.ly/1xrEr
According to a new Avison Young report, industrial real estate sales and lease deals in Metro Vancouver's largest submarket have rise dramatically from about this time last year. (Disclosure note: your agent was involved in preparing the report.)
In the first quarter of 2010, Richmond industrial investment dollar volume surpassed $60 million compared to only $3 million a year earlier, when global markets were still caught in the recession.
IKEA's acquisition of Key West Business Centre for $35 million spiked the dollar volume in the first quarter of this year, but the market still displayed underlying strength as deals tripled to nine from three in the first quarter of 2009.
Meanwhile, vacancy is hovering around 6%, but supply remains relatively tight due to limited available new and existing industrial inventory. Tenants should be able to capitalize on large inducements to renew existing lease agreements or sign new ones.
In some cases, landlords are offering several months of free rent in exchange for long-term lease agreements.
The report also details recent sales and leasing transactions and updates readers on phase II of Farrell Estates Ltd.'s Shelter Island project.
To access the report, click on the this link:
http://ow.ly/1xrEr
Monday, March 29, 2010
Calgary commercial activity continues upward
Calgary commercial real estate transaction activity is likely to continue upward as property values adjust to the new equilibrium and the bid-ask gap narrows, says an Avison Young report released Monday.
"While both the number of transactions and total dollar volume are down, activity levels and values are reflecting quality, not quanty," says the report.
The average price per transaction has only declined 1.5% versus the 10-year average and 2.7% versus the five-year average.
Overall transaction volume for six asset classes (office, retail, industrial, ICI land, and residential land) for 2009 was $1.42 billion from 127 sales. Dollar volume dropped 58% from 2009 and 69% from 2007.
Retail properties accounted for the largest dollar volume share (36%) in 2009 while industrial led in number of sales (28%).
"Knowledgeable, well-capitalized buyers are actively looking for quality products with long-term leases and good-quality tenants," says the report. "There are a number of positive factors within the investment market today."
For the first time in more than a decade, office deals took a backseat to retail transactions. Office transactions dropped 59% to 15 from 37 while office dollar volume dipped 70% to $377.8 million from $1.2 billion in 2008. The average sale price dropped to $25.2 million, or $254 per square foot (psf) from $33.5 million in 2008 and $39.8 million in 2007.
Office vacancy finished the year at 11.6%, compared to 6% at the end of 2008.
Meanwhile, 28 retail property transactions valued at $509 in 2009 were "highly comparable" to 28 worth $540 million in 2008.
However, Calgary's industrial market experienced one of its slowest years in the past five as 35 transactions valued at $228 million were completed. Industrial dollar volume was off the record-setting pace of 2008 and 2007 while vacancy reached 10.6% at the end of 2009, up slightly from the third quarter and up significantly from 7.8% at the end of 2008.
"While both the number of transactions and total dollar volume are down, activity levels and values are reflecting quality, not quanty," says the report.
The average price per transaction has only declined 1.5% versus the 10-year average and 2.7% versus the five-year average.
Overall transaction volume for six asset classes (office, retail, industrial, ICI land, and residential land) for 2009 was $1.42 billion from 127 sales. Dollar volume dropped 58% from 2009 and 69% from 2007.
Retail properties accounted for the largest dollar volume share (36%) in 2009 while industrial led in number of sales (28%).
"Knowledgeable, well-capitalized buyers are actively looking for quality products with long-term leases and good-quality tenants," says the report. "There are a number of positive factors within the investment market today."
For the first time in more than a decade, office deals took a backseat to retail transactions. Office transactions dropped 59% to 15 from 37 while office dollar volume dipped 70% to $377.8 million from $1.2 billion in 2008. The average sale price dropped to $25.2 million, or $254 per square foot (psf) from $33.5 million in 2008 and $39.8 million in 2007.
Office vacancy finished the year at 11.6%, compared to 6% at the end of 2008.
Meanwhile, 28 retail property transactions valued at $509 in 2009 were "highly comparable" to 28 worth $540 million in 2008.
However, Calgary's industrial market experienced one of its slowest years in the past five as 35 transactions valued at $228 million were completed. Industrial dollar volume was off the record-setting pace of 2008 and 2007 while vacancy reached 10.6% at the end of 2009, up slightly from the third quarter and up significantly from 7.8% at the end of 2008.
Thursday, March 11, 2010
NAIOP panelists to assess recovering market
How can commercial real estate developers profit from the current economic recovery?
NAIOP Vancouver members will attempt to answer that question during this month's breakfast meeting, March 18 at the Hyatt Regency.
The panel will discuss the market's current and future prospects in wake of the global economic downturn and examine ways to profit heading into the next expansion phase. It should be a lively discussion, because the Vancouver market is extremely active right now with many deals in the works, especially in retail, which made a strong comeback in the second half of 2009 following a slow start to the year.
Bill Tucker, CEO of Omicron Canada Inc., which assists developers from design to construction and offers such services as architecture and engineering, will serve as the moderator. The panelists include Gino Nonni, president of Wesgroup Properties; Ron Emerson, president of Emerson Real Estate Group and Andrew Grant, president of PCI Group.
Wesgroup and PCI Group are two of Metro Vancouver's most active and prominent developers.
For more details NAIOP's monthly breakfast, click on the link below:
http://www.naiopvcr.com/eventCalendar.aspx#e38
NAIOP Vancouver members will attempt to answer that question during this month's breakfast meeting, March 18 at the Hyatt Regency.
The panel will discuss the market's current and future prospects in wake of the global economic downturn and examine ways to profit heading into the next expansion phase. It should be a lively discussion, because the Vancouver market is extremely active right now with many deals in the works, especially in retail, which made a strong comeback in the second half of 2009 following a slow start to the year.
Bill Tucker, CEO of Omicron Canada Inc., which assists developers from design to construction and offers such services as architecture and engineering, will serve as the moderator. The panelists include Gino Nonni, president of Wesgroup Properties; Ron Emerson, president of Emerson Real Estate Group and Andrew Grant, president of PCI Group.
Wesgroup and PCI Group are two of Metro Vancouver's most active and prominent developers.
For more details NAIOP's monthly breakfast, click on the link below:
http://www.naiopvcr.com/eventCalendar.aspx#e38
Tuesday, March 9, 2010
Former Watergate investigator joins Avison Young
Legendary commercial real estate executive Stephen Leopold has returned to his Quebec roots.
Avison Young announced Tuesday that Leopold has been appointed chair of the brokerage firm's Quebec operations.
Leopold, whose career spans four decades, will advise on strategy and growth in the Quebec marketplace.
In the 1970s, he served as an investigator on U.S. Senator Sam Ervin's Watergate Committee, which investigated former president Richard Nixon. In the 1980s, Leopold, a Montreal native, acted as executive assistant to Brian Mulroney during a successful Progressive Conservative Party leadership campaign that helped him become prime minister.
Leopold's many commercial real estate career highlights include serving as vice-president of Canada's largest mortgage bank, now known as RBC Capital; forming his own firm, Montreal-based Leopold Property Consultants, which became the largest North American company to represent corporate users of space; and conceiving and creating Skymarkets in the World Trade Center. In 2002, he was appointed chairman of William B. May International in New York, which was founded in 1866 and ranks as one of North America's oldest brokerages.
Avison Young chair and CEO Mark Rose says Leopold's appointment is part of the company's aggressive expansion plan and demonstrates its increasingly significant presence in North America.
Leopold will be based in Avison Young's Montreal office.
Avison Young announced Tuesday that Leopold has been appointed chair of the brokerage firm's Quebec operations.
Leopold, whose career spans four decades, will advise on strategy and growth in the Quebec marketplace.
In the 1970s, he served as an investigator on U.S. Senator Sam Ervin's Watergate Committee, which investigated former president Richard Nixon. In the 1980s, Leopold, a Montreal native, acted as executive assistant to Brian Mulroney during a successful Progressive Conservative Party leadership campaign that helped him become prime minister.
Leopold's many commercial real estate career highlights include serving as vice-president of Canada's largest mortgage bank, now known as RBC Capital; forming his own firm, Montreal-based Leopold Property Consultants, which became the largest North American company to represent corporate users of space; and conceiving and creating Skymarkets in the World Trade Center. In 2002, he was appointed chairman of William B. May International in New York, which was founded in 1866 and ranks as one of North America's oldest brokerages.
Avison Young chair and CEO Mark Rose says Leopold's appointment is part of the company's aggressive expansion plan and demonstrates its increasingly significant presence in North America.
Leopold will be based in Avison Young's Montreal office.
Monday, February 22, 2010
B.C. investment volume rises over low cap rates
British Columbia's commercial real estate investment market made a strong comeback in the second half of 2009, says a new Avison Young report.
The number of transactions increased to 37 from 23 in the first half, which at the time marked the lowest first-half total in seven years. Meanwhile, second-half investment volume rose 11% to $715 million from $643 million in the earlier period, the report adds. Total investment for the year reached $1.36 billion, up from $1.27 billion in all of 2008, when provincial investment activity was caught in the global economic downturn.
The report attributes the increases mainly to a narrowing of the bid-ask gap as the effects of the worldwide downturn and U.S. credit crisis subside further.
Retail deals spurred the second-half 2009 comeback after lagging in the first six months. A total of 16 retail deals were completed in the second half compared to four in the first half. Remaining second-half trades were split evenly between office (11) and industrial (10).
For the year, total trades dropped to 60 from 68.
In the second half of 2009, retail investment volume accounted for $64%, or $458 million, compared to a modest 6% ($41 million) in the first half. Following a 70% drop, office deals accounted for $154 million as opposed to $506 million in the first half.
The large decrease resulted because large Downtown Vancouver office deals similar to Bentall V ($297 million) and the Grosvenor building ($84 million) did not repeat in the second half.
Industrial volume rose slightly to $102 million in the final six months of 2009.
Looking at 2009 as a whole, deals were evenly split between office (19), retail (20) and industrial (21). Office deals comprised 49%, or $660 million, of volume while retail accounted for 37% ($499 million) of volume and industrial represented 15% ($199 million).
The year-over-year increase in sales volume occurred even though the province's traditionally low capitalization rates nudged downward.
And, they are expected to continue on that course.
The number of transactions increased to 37 from 23 in the first half, which at the time marked the lowest first-half total in seven years. Meanwhile, second-half investment volume rose 11% to $715 million from $643 million in the earlier period, the report adds. Total investment for the year reached $1.36 billion, up from $1.27 billion in all of 2008, when provincial investment activity was caught in the global economic downturn.
The report attributes the increases mainly to a narrowing of the bid-ask gap as the effects of the worldwide downturn and U.S. credit crisis subside further.
Retail deals spurred the second-half 2009 comeback after lagging in the first six months. A total of 16 retail deals were completed in the second half compared to four in the first half. Remaining second-half trades were split evenly between office (11) and industrial (10).
For the year, total trades dropped to 60 from 68.
In the second half of 2009, retail investment volume accounted for $64%, or $458 million, compared to a modest 6% ($41 million) in the first half. Following a 70% drop, office deals accounted for $154 million as opposed to $506 million in the first half.
The large decrease resulted because large Downtown Vancouver office deals similar to Bentall V ($297 million) and the Grosvenor building ($84 million) did not repeat in the second half.
Industrial volume rose slightly to $102 million in the final six months of 2009.
Looking at 2009 as a whole, deals were evenly split between office (19), retail (20) and industrial (21). Office deals comprised 49%, or $660 million, of volume while retail accounted for 37% ($499 million) of volume and industrial represented 15% ($199 million).
The year-over-year increase in sales volume occurred even though the province's traditionally low capitalization rates nudged downward.
And, they are expected to continue on that course.
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