Thursday, November 12, 2009

Commercial Real Estate Rebounds in Canada

Canada's commercial real estate market is rebounding faster than many in the industry projected just a few months ago. The market unexpectedly caught fire in September as access to capital improved and buyers waded into the depressed market, and a full-blown recovery seems under way in major segments of the market.

"Things have changed," said PwC partner Frank Magliocco as he released the report yesterday. "Things just took off." There have been three deals worth more than $100-million in the past month - an apartment portfolio in Vancouver, as well as residential land and a downtown building in Toronto - which would have been unthinkable in July.

"If I told you in the spring that those deals would happen, you'd have told me I was crazy," said George Carras, president of tracking firm RealNet Canada Inc. "There was no way you'd have believed me, sentiment was just too low."

There have been other signs of recovery, most notably the first quarter of growth in Toronto's commercial real estate sector after 18 months of declining fortunes. Data for Calgary and Vancouver show those markets stabilizing as well, according to RealNet.


At 11/12/2009 9:16 PM, Anonymous Anonymous said...

I often take the position the America should give Michigan to Canada. This might very well resolve the states problems.

California could then split so we can keep the current flag.

At 11/13/2009 1:47 AM, Anonymous Mansion said...

Too bad CRE is tanking here in the US.

Record high vacancy rates and climbing

Record high default rates and climbing

Record high bank CRE concentrations

Record high bank C&D concentrations

Record high bank C&I concentrations

Record CRE price declines and still falling

Record high cap rates and still climbing

Record low transaction volumes and still falling

Record rent declines and still dropping

US commercial real estate has now broken more records than Michael Phelps.

At 11/13/2009 9:07 AM, Blogger juandos said...

Geez! Mansion you're pushing a rather bleak picture sir...

Then again you are hardly alone...

Courtesy of The Business Insider: Mack-Cali Chairman: Commercial Real Estate Is Between A Massacre And A Disaster
(video clip)

Again from The Business Insider: California: Most Commercial Property Deals From 2005 Onward Are Underwater

At 11/13/2009 11:19 AM, Anonymous Mansion said...

It's why I laugh every time I hear talk of economic recovery. The next big banking crisis is only months away.

Banks are not lending because they're building allowances for loan and lease losses. They're also being urged to raise capital by any means necessary which is a polite way of telling them to open their own wallets. When all that capital is awash the economy will grind to a screeching halt and government will "have" to step even more into the private sector.

You got all the PhriggingDs talking about "indicators" and they don't have a clue what's going on in their own bank, their own grocery store, and their own dry cleaners. When some schmoe is talking to you about "indicators" and "surveys" you should know immediately he's not living in the real world. He's worse than a writer for a fortune cookie company.


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