Condo demand
The volume of completed and unsold condos is up across Metro Vancouver but demand is keeping inventories in check, according to the residential market report Colliers International released last week.
“There is little concern of an oversupply of unsold inventory in the overall market,” the report stated – a sentiment shared by the latest report on the condo market from Royal LePage Real Estate Services.
Royal LePage’s report points to interest rates and job growth as key variables influencing condo sales in the year ahead, but Bill Binnie, owner of Royal LePage Northshore, believes they’ll combine to fuel demand as job-seekers seek opportunities in the province.
“Demand is going to absorb the current stock,” Binnie said.
While job growth was off across the province this year, Binnie sees the start of more than $11 billion in federal shipbuilding work next year putting cash in the pockets of workers who are hard-pressed to find rental accommodation.
With the majority of completed and unsold condos in North Vancouver near the shipyards, he expects demand to absorb any standing inventory.
“There’s a high demand for apartments,” Binnie said. “[It]’s going to place a lot of people into a market that has a lot of unsold apartments in it ... and most of the unsold apartments are along Marine Drive in North Vancouver, and the shipbuilding is at the foot of Pemberton.”
Binnie sees buyers being more influential in the market than investors, who sales agents estimate make up approximately 15% of the market. By contrast, first-time homebuyers make up 40% of the North Shore market.
Still, investors are a force to be reckoned with.
According to a recent crunching of 2011 census numbers by Altus Group, 40% of the 42,000 condo units built in metropolitan Vancouver between 2006 and 2011 were rented out in 2011.
While this might not be the case on the North Shore, which Colliers describes as a market “driven primarily by end-user buyers,” hiring at the shipyards could prompt investors to consider the opportunities.
Appliance within
Condo owners are good news for Edmonds Fine Appliances, which recently made the move to the Southeast False Creek neighbourhood after 40 years in Burnaby.
Edmonds, which also operates Y. Franks Appliances Ltd. in West Vancouver, includes a section showcasing two-foot-wide appliances in its new 3,200-square-foot location on West 2nd Avenue. Edmonds has established relationships with developers including Westbank Projects Corp. and Aspac Developments Ltd., but it sees condo towers in Vancouver’s core to be a promising source of business.
Edmonds president and general manager Glenn Anderson said there are 25,000 condos within a five-mile radius of the new Vancouver location.
And many of those are older units outfitted with appliances that will eventually need replacing.
With approximately 70% of its business in condos at present, Edmonds believes it is well positioned to replace older appliances with highly efficient, space-saving units.
Acquiring space
AIMCo Realty Investors LP of Alberta, working with asset manager Blackwood Partners Management Corp. has acquired Renfrew Centre from its development partner Pacific Capital Real Estate Group.
The deal closed earlier this fall but was announced in early November, coinciding with the start of construction of the 170,000-square-foot office project. A value wasn’t disclosed for the property, located at Renfrew and East 12th Avenue in Vancouver adjacent to the Renfrew SkyTrain station and opposite the Art Institute.
Pacific Capital had undertaken pre-marketing for the seven-storey project but without lease commitments in place it hadn’t proceeded with construction. The investment by AIMCo and Blackwood allowed construction to proceed with a completion date of 2015.
Jonathan Button, senior vice-president of asset management and operations for Blackwood, said the property was attractive because of its central location in the region on transit and as well as the Central Valley Greenway bike route.
Blackwood owns a variety of projects in B.C., including the Central City office complex in Surrey, and manages a portfolio of industrial and mixed-use properties. •