Vancouver Investment Transaction Stats – Q4 2017
Land Boosts Greater Vancouver Commercial Real Estate Investment to Record Altitude
2017 saw a total of 2,274 sales transactions over $1 million, representing a total investment value of $14.2 billion
VANCOUVER ‒ Altus Group, a leading provider of commercial real estate services, software and data solutions, today announced the Vancouver market area’s cumulative commercial real estate investment results for 2017. In total, 2,274 transactions over $1,000,000 were captured, worth nearly $14.2 billion and representing a 16% increase from the previous year. This ranks Vancouver just behind the Greater Toronto Area with $23.5 billion transacted in 2017. Vancouver represented 25% of the Canadian transactions tracked by Altus Group in 2017 and continues to attract both domestic and foreign investors. The challenge remains with the availability of product, with no apparent shortage of available capital for quality assets.
Source: Altus Group
The residential land market flirted, for the second time, with the 50% mark in terms of the sector’s overall investment contribution to the entire market. A total of $6.56 billion of investment was placed towards residential land transactions, up 13% from the previous year. The top five transactions of the year, each over $100 million, combined for a total of $992 million and included the sale of the White Spot site on West Georgia Street in Vancouver, two ‘Jericho Lands’ sites which were acquired by MST Development, and an as-of-now industrial site that was acquired at Willingdon Avenue and Dawson Street in the Brentwood area for residential redevelopment.
ICI land was the second largest contributor to investment totals at $2.37 billion, representing 17% of the market. Industrial land transactions had a record year, a 102% increase over 2016, with $681 million allocated towards a total of 475 acres. Wesbild’s acquisition of 27.5 waterfront acres in North Vancouver leads all industrial land acquisitions, for a total consideration of $115 million. Agricultural land transactions amounted to $1.07 billion, down 18% from 2016, and only the second time over the $1 billion threshold (33% of this amount was towards ‘working’, or agricultural business, land).
2017 also marked record years for the office, retail and industrial sectors. The office market saw significant contributions from Cadillac Fairview’s 50% sale of their downtown Vancouver office/retail portfolio to Ontario Pension Board and Workplace Safety & Insurance Board. Office properties included Waterfront Centre, Waterfront Station, Granville Square and PriceWaterhouseCoopers Place.
Retail recorded two significant transactions that helped the sector exceed the previous record year (2016) by 53%. A total of $1.725 billion in retail investment was recorded in 2017, led by bcIMC’s 50% acquisition of Oakridge Centre for $480.7 million; the remaining 50% was also acquired via share sale transaction. Kunyuan International acquired Columbia Square Plaza in New Westminster for $97 million. Both transactions were acquired in part due to the opportunity to add density to the existing properties. All other activity in the retail market took place below the $30 million threshold.
The industrial sector was up 2% from 2016, setting a new record with $1.2 billion in total investment. Acquisitions by Dayhu, Port of Vancouver and Kingsett Capital led all other acquisitions and combined for 10% of the capital flow in the industrial market. Activity in the sector was strong with 240 transactions.
“Already at peak levels at the end of 2016, investment activity tailed off but remained strong, making 2017 the eigth consecutive year of investment growth,” noted Paul Richter, Director, Data Solutions at Altus Group. “While cap rates continued to compress, they did so at a much slower rate in 2017. Quality assets remain in high demand, across all asset classes. Investor confidence remains strong especially for assets that allow for intensification and the inclusion of a growing number of uses as the region continues to accommodate additional ‘city centres’ clustered near transit nodes.”
ABOUT DATA SOLUTIONS
Data Solutions connects the Canadian real estate industry through the delivery of data with unparalleled breadth, integrity and relevance. We cover new homes, investment transactions and commercial market inventory in key markets, and also provide intelligence on the national housing market and consumer home buying and borrowing patterns.
Our solutions are used by real estate industry stakeholders to gain market intelligence, identify and validate opportunities, benchmark, strategically plan, manage risk and more.
Data Solutions is part of Altus Analytics, the software and data solutions business of Altus Group, where our focus is to empower real estate clients and partners to work collaboratively to enhance decision making, drive performance and optimize transactional efficiency. Our solutions enable firms to better organize and manage data and connect with the right information and analytics to help them gain a complete picture of real estate assets, portfolios and transactions.
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ABOUT ALTUS GROUP LIMITED
Altus Group Limited is a leading provider of independent advisory services, software and data solutions to the global commercial real estate industry. Our businesses, Altus Analytics and Altus Expert Services, reflect decades of experience, a range of expertise, and technology-enabled capabilities. Our solutions empower clients to analyze, gain insight and recognize value on their real estate investments. Headquartered in Canada, we have approximately 2,500 employees around the world, with operations in North America, Europe and Asia Pacific. Our clients include some of the world’s largest real estate industry participants across a variety of sectors. Altus Group pays a quarterly dividend of $0.15 per share and our shares are traded on the TSX under the symbol AIF.
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