Building Magazine


Canadian commercial real estate market remains strong and stable

The Real Property Association of Canada (REALpac) and FPL Advisory Group have announced the results from the Fourth Quarter 2012 REALpac / FPL Canadian Real Estate Sentiment Survey, which recorded the thoughts of a wide variety of industry leaders, including CEOs, presidents, board members, and other executives from a broad set of industry sectors, including owners & asset managers, financial services providers, and operators & related service providers.

The Q4 Index saw little change from recent quarters; while the Canadian market is viewed as strong and stable, many still show concern over international economic conditions.

Additional topline findings include:

•           Many express positivity in the overall market, while some look for a further U.S. recovery to spark additional activity; a lack of Class A product remains a primary issue

•           Cap rate compression and the low interest rate environment have led to very high asset pricing; many worry that an increase in interest rates could drive values down going forward

•           Debt availability remains strong, especially for low-risk assets; however, lenders are finding longer term loans increasingly less attractive

•           Equity capital is seen as widely available as both public and private investors continue to find real estate attractive

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