RealNet Canada released its review of land transactions in the Greater Toronto Area, in the first fiscal quarter of 2011. During this period, RealNet’s research reveals that overall, real estate investment activity in the GTA’s commercial real estate investment market declined by approximately 29 per cent (by dollar volume) and declined by 12 per cent (by number of transactions), from the previous quarter. Even still, 370 transactions over $1 million were recorded in the first quarter of 2011 totaling $2.24 billion.
The Retail and Residential Land sectors were the strongest performers of Q1, as the Retail sector posted its fourth best quarter to date. Transaction counts were steady from the previous quarter, however overall investment was down 23 per cent from Q4-1010 (the strongest period on record).
Bentall’s $226 million acquisition of the retail centre located at 10 Dundas East was the largest overall transaction in Q1-2011.
RealNet Canada’s president, George Carras, notes that the “Residential Land sector was the only asset class to show positive growth in both deal counts and overall investment, this past quarter.” Carras points to the 77 per cent increase in total volume registered as driven, primarily by “five transactions greater than $25 million.”
The sale of a 56.7 acre parcel of low density land in Mississauga, to Argo Park Developments, represented the largest residential land transaction of the quarter at $68 million. Overall transaction activity increased by 17 per cent from the previous quarter to 74 transactions and was the highest posted since the previous high of Q1-2008.
In reviewing the first quarter numbers, George Carras suggests that “the strong growth in residential land investments is a logical response to the strong demand in new home sales and the low supply of active inventory.”