CBRE predicts record $50-billion investment for commercial real estate this year
Vancouver's skyline is seen in an image from CTV News Vancouver's Pete Cline captured in May 2019 from Chopper 9
TORONTO -- CBRE says Canada could see a record-breaking $50 billion worth of investment in commercial real estate this year as macroeconomic tailwinds and immigration policies support the booming sector.
The commercial real estate services firm says the investment would be about $5 billion higher than 2019 and about a billion dollars higher than the record set in 2018.
Heightened interest in the market is also creating challenges, including rising rents and limited office and industrial space, while climate change is creating its own issues.
CBRE says prime office rents jumped by 20.9 per cent in Vancouver between 2018 and 2019, 14.2 per cent in Montreal, and 10.1 per cent in Toronto, while national industrial rents rose by 12.3 per cent between the two years for the largest increase on record.
It says the combination of challenges has the potential of slowing momentum in the commercial real estate sector.
The coronavirus outbreak is also creating uncertainty, but the firm says that if it is relatively contained sometime in March, then the impacts on the Canadian economy and commercial real estate would be noticeable in the near term but less substantive over the year.
This report by The Canadian Press was first published Feb. 25, 2020.