Making sense of 2016’s polarised Canadian CRE market
The commercial real estate (CRE) market in Canada today is one of stark contradictions, heavy polarisation and is extremely difficult to neatly categorise, according to CBRE.
Paul Morassutti, Executive Managing Director of CBRE stated that the market is arguably experiencing the widest ever disparity in the performance of assets based on geography and asset class.
“If you were an investment broker in Vancouver, you were popping champagne bottles at the end of last year. An office leasing agent in Calgary? Not so much. There was record pricing for some assets and, for others, limited liquidity,” commented Morassutti adding that a lack of uniformity has made it a curious time for the Canadian CRE market.
Furthermore, Morassutti cautioned that there was a need to “be careful of averages” and that in such a disparate market, average industry key performance indicators such as national or even regional vacancy rates reveal very little. Consequently, Morassutti reasoned that there were several common perceptions about the CRE market in Canada that do not accurately reflect the reality of its underlying fundamentals in 2016.
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