A record level investment of $2.35 billion was made in commercial real estate in B.C. in 2012, according to a new Avison Young (AY) report.
Investors seeking safe havens from political and economic uncertainty elsewhere in the world is cited as one of the driving forces behind the $2.35 billion in sales in 2012.
There were 117 commercial real-estate transactions in 2012, the AY report states, with multiple transactions exceeding $100 million. The report does not include residential real estate transactions.
"Investors' appetite for B.C. commercial real estate in 2012 was insatiable," said Michael Keenan, principal and managing director of AY's Vancouver office.
"Record levels of capital were deployed in all asset classes, and additional investment was only restricted by a lack of available quality product. We continued to see significant demand in 2012 from private investors as well as institutional buyers and, after a slight hiatus, the return of REITs in a meaningful way."
Investment in industrial properties in B.C. accounted for $548 million in sales in 2012. Sales of office properties in the first half of 2012 totalled $764 million and only tailed off to $204 million in the second half due to a lack of properties for sale.
"The commercial real-estate market started shifting in late 2012 as there were more opportunities Canada-wide to acquire office, retail and industrial assets that were coming to market," said AY principal Bob Levine.
"We do see a trend of large property owners with substantial portfolios considering selling off parts of their portfolios due to strong pricing. It appears that a number of these groups have come to the same conclusion at the same time."