Commercial real estate sales in the Canadian city of Calgary reached $3.2 billion in 2014, an increase of 2 per cent over the previous year, according to a new report from RealNet Canada Inc.
The report states that 483 transactions worth in excess of $1 million were recorded over the course of the year, representing the fifth best year on record for the city.
Paul Richter, the director of research at RealNet Canada, said that the last half of 2014 was a strong six months for the Greater Calgary commercial real estate market and it caps a very healthy five-year run from the market adjustments experienced in 2009. With the exception of the office market, all asset classes saw year-over year growth.
Joe Binfet, the managing director/broker for Colliers International in Calgary, said that 2014 was a “terrific year for the firm’s investment division.
He went on to say that 2015 will be a challenging one and that Colliers is seeing “a standoff” between buyers and sellers across the board.
Owners are reluctant to sell in current market conditions, while buyers are looking for a discount in pricing. On a positive note, there is still a significant level of buyer interest in the Calgary market.
The office market currently has an abundance of supply, particularly in sublease space. Demand is weak now, since tenants are making decisions about leasing.
Both tenants and landlords are waiting for more clarity about what the energy markets are going to do before signing leases – How low with the price of oil fall? How long will prices stay down, and when will the situation improve?
Comparing the 2012 market conditions to 2014, investment totals in retail and hotel are down between 40-45 per cent from 2012.
Investment declined by close to 65 per cent in the office market, according to the RealNet report.
