Vancouver real estate developers and brokers are downplaying concerns over the purchase of Lower Mainland commercial properties by foreign investors.
The concerns arose following a news story last month that the owner of a Vancouver property had requested that the agent restrict the search for buyers to foreign investors only.
The report, regarded the sale arranged by CBRE Group of a $30 million property to a foreign buyer. According to the contents of an e-mail published by a news agency, the owners had instructed that the portfolio not be advertised to potential buyers in the Canadian market. CBRE therefore arranged an international marketing campaign for the property. The sale closed at $5 million above market price.
The news came in the midst of a heightening debate in Greater Vancouver over the sale of both residential and commercial assets to foreign buyers while prices and the cost of living surge to never-before-seen levels.
According to CBRE’s executive vice-president and managing director in Vancouver, Norm Taylor, the practice is not widespread. He went on to say that buyer and seller motivations remain confidential in each transaction that CBRE completes.
Other commercial real estate brokers commented that some of the bigger deals which have been completed over the past year have involved local buyers. Hani Lammam, the executive vice-president of Cressey Development Group, stated that his company does not take offence if a seller chooses only to solicit offers from foreign buyers.
He said that in that situation he would interpret it as the seller looking for a buyer who is less knowledgeable about the market and is looking for someone more likely to pay above market prices.
In British Columbia, there are no restrictions in place on foreign ownership of private land and Lammam said he didn’t see any need for the current system to change. He stated that as long as the purchasing funds are legitimate, his firm doesn’t believe the government should interfere in the free market.
He concluded by saying that the government should only take action to prevent “ill-gotten funds” from “confusing” the market.
