Western Canadian commercial real estate should see revival this year
According to RE / MAX, the resilient commercial real estate markets in western Canada are likely to recover in the second half of 2021.
In the latest edition of its Commercial Real Estate Report, RE / MAX said the commercial sector has maintained respectable strength thanks to institutional investors and private equity fueling demand for multi-unit residential, industrial and office buildings.
“Industrial has taken the limelight [during the pandemic] As e-commerce sales exploded across the country – creating even greater demand – while the retail and office sectors struggled with lockdowns and security, ”said Elton Ash, regional executive vice president, RE / MAX in Western Canada .
Building on that momentum, RE / MAX said the main drivers behind increased demand in the commercial market this year will be historically low interest rates and continued post-pandemic recovery. Higher consumption as the economies reopen will also contribute to the upswing.
“The recovery in global primary energy demand should help boost economic performance and demand for commercial real estate in Alberta in the second half of 2021,” said Ash. “In the meantime, we’ve seen institutional investors outside of the province walk away with some of the city’s most coveted assets.”
Another asset class to watch out for is farmland, especially since the average total price for the investment in Canada rose 3.7% over the past year.
“Saskatchewan’s attractive price is expected to continue to attract investors and end-users, particularly from provinces with higher farmland values, in the coming months,” said Ash. “This segment is also expected to warm up as foreign investment returns to the overall market in 2021.”