Edmonton real estate investment volume grew for the third straight year in 2018, according to a new analysis by Altus Group.
Total investment in the city’s properties grew to $3.94 billion last year, “despite a national struggle to balance supply and demand in real estate,” Altus noted. “This level of investment lead to robust gains in the Industrial sector and the Apartment sector in 2018.”
Investment property sales also grew by 37% in 2018, with the industrial sector contributing the largest volume at $878 million across 220 transactions.
“Demand for new office and industrial space is expected to stay strong over the next year,” Altus stated.
The office and retail sectors had generous gains last year, with the office market enjoying a $149-million increase and the retail segment having a $141-million growth.
“However, the office vacancy rate increased slightly to above 15% in 2019, with continued demand for new modern spaces in the downtown region.”
Residential land investment also accelerated by 18%, while the apartment segment saw the largest annual increase in terms of dollar volume, growing by 69% to reach $849 million.
Late last month, a study by Marcus & Millichap noted that the Edmonton market’s prospects for the rest of 2019 are remarkably bright in terms of demand and rent growth.
The report added that the commercial sector will especially benefit, with the completion of around 1.2 million square feet of office space by year-end most likely boosting market activity.
A significant proportion of purchases will be by established companies relocating to newer spaces that would better suit their needs.
“New and modern office space with the amenities employees desire is in high demand, though as tenants move to updated offices, older and less desirable space is left vacant,” Marcus & Millichap stated.
“Strong demand for multifamily and hospitality have provided an opportune use for inefficient and obsolete offices. Renovations and increased amenity packages at other properties can bring older office inventory back in favour with expanding firms.”
Ephraim is currently a journalist at Mortgage Broker News, Real Estate Professional and Canadian Real Estate Wealth.
Ephraim is a highly accomplished news reporter whose work has been published across North America and the Asia Pacific region. Before joining Key Media, Ephraim spent eight years working as a journalist with Reuters TV. His areas of expertise include real estate, mortgage, and finance.
As part of its response to Canada’s ongoing housing challenges, the federal government has added another 12 new properties to the Canada Public Land Bank,...
As part of its response to Canada’s ongoing housing challenges, the federal government has added another 12 new properties to the Canada Public Land Bank,...
