Metro Vancouver Commercial Real Estate

Bond Yields Continue to Support Cheap Debt

MVCRE — Wed, 08 Feb 2012 16:57:13 +0000

Debt financing for most commercial real estate assets in Metro Vancouver continues to be attractive as lenders continue to offer mortgage rates underpinned by historically low interest rates.

The yield on 5-year GOC bonds sits at 1.38% as of February 7, 2012. 10-year bonds currently sit at 2.04%.

Source: Bank of Canada

Mark Elle Apartments, 1030 West 14th Sold

MVCRE — Wed, 08 Feb 2012 15:52:15 +0000

A 32-unit 3-storey walkup apartment building on West 14th Avenue between Spruce and Oak Streets in the South Granville area of Vancouver has sold for $8,500,000, representing a 3.4% cap rate, and $265,000 per unit. The building was built in 1966. The purchaser was a local private investor.

601-615 East Broadway, Vancouver Sold

MVCRE — Tue, 07 Feb 2012 15:23:47 +0000

The Property Management Group has acquired 601-615 East Broadway, a 10,622 sq ft corner strip mall located at East Broadway and Carolina Street. The tenant mix including Mac’s convenient store, Subway and local tenants. The purchase price was $3,950,000, representing $317 per sq ft and a 5.4% cap rate on stabilized income.

Given the C2-C zoning and location in the Mount Pleasant Community Plan, the property represents medium term redevelopment potential.

Investors Group Acquires 1090 Homer Street

MVCRE — Fri, 03 Feb 2012 16:54:06 +0000

Investors Group has purchased 1090 Homer Street, a 6-storey, 64,000 square foot office building located at Homer and Helmcken Street in the Yaletown area of Vancouver.

The purchase price was $38,300,000, representing $598 per sq ft, and a 5.5% cap rate. Notable tenants on the ground floor include CIBC and Blue Water Cafe. The building was built in 1917.

Oxford Secures Anchor Tenant, Rebrands Project MNP Tower

MVCRE — Thu, 02 Feb 2012 15:59:05 +0000

Oxford Properties has announced that it has secured a pre-lease commitment from MNP LLP, one of Canada’s largest chartered accountancy and business consulting firms.

MNP will lease 72,000 square feet of the office tower over nine floors. The building will be rebranded the MNP Tower. It is expected that the tower will be completed in 2014.

Source

More Details on Little Mountain Proposal

MVCRE — Wed, 01 Feb 2012 15:44:43 +0000

Holborn Group are proposing a largely-residential development with a significant social housing component on the Little Mountain Housing site. The proposal includes:

Approx. 1,600 units of market housing: condominiums and townhouses.
234 units of social housing, with 186 of those for families (2 or more bedrooms) and 10 units specifically for urban Aboriginals.
Local-serving retail and commercial uses on and near Main Street
Public green space and open space
A new Little Mountain Neighbourhood House and childcare facility

What’s next?

The current stage of planning, creating the Policy Statement, is intended to wrap up in mid-to-late 2012. Then Holborn will apply to the City to rezone the site, which will take approximately 12 -18 months to complete. Expect construction efforts to get underway in 2014.

32-storey Office Tower Proposed for Granville Parkade

MVCRE — Tue, 31 Jan 2012 15:46:23 +0000

VIA Architecture has applied to the City of Vancouver to rezone the current multi-level parkade at 320 Granville Street from DD (Downtown) District to Comprehensive Development District.

The proposal is for a 32-storey office building, with retail and a bike station at grade, and a childcare on the top floor. The development would be comprised of 380,000 sq. ft. of floor area, with a floor space ratio of 25.5 FSR, and a height of 390 ft. There would be 4 levels of underground parking.

The current parkade had been rumoured for redevelopment for several years. It boasts an excellent location across the street from Waterfront Station; however, it may take upwards of 12 months to achieve rezoning.

More information here.

Westside Retail Values Show Gradual Increase, Reflecting Rents

MVCRE — Mon, 30 Jan 2012 11:24:43 +0000

Demand continues to heavily outpace supply for retail investment opportunities on the Westside of Vancouver (excluding Downtown Vancouver). This has been particularly due to the ongoing demand on behalf of developers to redevelop commercial properties once solely retail, as mixed-use developments. This coupled with the continued availability of debt, has compressed cap rates for many retail assets in this traditionally attractive and supply-constrained market.

Retail assets that have traded over the past 5 years have typically been freehold or strata streetfront retail, with most sales occurring in the Kerrisdale, West 4th Ave, or West Broadway corridors. Cap rates for retail tend to be between 4.5% and 5.5% in this market, depending on the tenant.

2010 and the first half of 2011 was one of the softest periods of leasing activity in the last 20 years throughout Metro Vancouver, and the Westside was also affected. The second half of
2011, however, showed signs of improvement, with positive momentum continuing into 2012. Rental rates have grown gradually depending on economic activity, and this has been reflected in pricing with centrally located premises now commanding over $900 per sq ft. Average pricing has grown gradually as shown here:

Source: Colliers Research

Which areas of Metro Vancouver grew fastest in 2011?

MVCRE — Thu, 26 Jan 2012 15:39:47 +0000

According to the Province’s 2011 Sub-Provincial Population Estimates, Surrey continued to lead all Metro Vancouver municipalities in 2011 with a 2.4% growth rate, adding over 11,000 people; beating out the much larger City of Vancouver in terms of absolute growth and percentage growth.

Source: BC Stats

Some smalller cities posted good growth levels including Port Moody, New Westminster and Pitt Meadows, despite much smaller populations. The City of Vancouver continued its positive trend with 8,391 new people in 2011, representing 1.3% growth. Squamish posted phenomenal 4.6% growth after a few years of stagnancy. Mission was the only area near Metro Vancouver posting a decline.

As Gordon Price pointed out, unless Vancouver stops growing altogether, it will still be decades before Surrey overtakes it as the largest municipality in B.C.

Evergreen Line Presents Numerous Development, Investment Opportunities

MVCRE — Wed, 25 Jan 2012 17:03:02 +0000

Pre-construction work begins this week with completion in Summer 2016

The newest addition to Metro Vancouver’s rapid transit network is the Evergreen Line. The line will connect Coquitlam to Vancouver via Port Moody and Burnaby. It will connect without transfer to the current SkyTrain network at Lougheed Town Centre Station and will integrate with regional bus and West Coast Express networks.

The line totals 11 km in length and has 6 stations. It will link Coquitlam City Centre to Downtown Vancouver in 40 minutes.

Development and Investment Potential

The Cities of Burnaby, Port Moody and Coquitlam have all undertaken varying measures of adaptation in planning to accommodate the Evergreen Line. The main commercial/residential corridors primed for additional growth are as follows:

North Road
Clarke Road
St. Johns Street/Clarke Street
Aberdeen Avenue/Barnet Highway
Pinetree Way

7707 Royal Oak, Burnaby Sold

MVCRE — Tue, 24 Jan 2012 15:56:35 +0000

The strip retail building at 7707 Royal Oak in Burnaby has sold to 7707 Royal Oak Developments Ltd. for $2,175,000, representing $75 per buildable SF on a site area of 19,425 SF. The building has 8,285 SF of rentable area.

Six local tenants occupy the premises and include a convenience store, restaurant, video store, beauty shop, a doctor and a Chinese take out food store.

The property is designated as mixed-use in the Royal Oak area plan and represents near term redevelopment potential.

PCI acquires Canadian Tire Site on East Hastings

tanya — Fri, 20 Jan 2012 22:22:18 +0000

PCI Group, which has undertaken several successful mixed-use developments including Crossroads, and the currently under development Marine Gateway, have acquired the former Canadian Tire site at 1460 East Hastings Street at McLean Drive in East Vancouver.

The current zoning is MC-1 industrial; however, it is expected that PCI will propose to rezone the site for a mix of uses. Stay tuned for more information.