Residential brokers inclined to envy their commercial counterparts don’t: An increasingly meagre supply of properties will likely translate into fewer deals for them in 2013, outside of the harder-to-come-by new builds.
Residential brokers inclined to envy their commercial counterparts don’t: An increasingly meagre supply of properties will likely translate into fewer deals for them in 2013, outside of the harder-to-come-by new builds.
"With all the headwinds that continue to plague our industry,” writes Avison Young CEO Mark E. Rose, in the company’s forecast for the Canadian and U.S. commercial sector, “what we have been advising for the last three years will continue to be our mantra: stay patient, risk-manage your strategy on the buy-side, and take advantage of off-market and distressed opportunities when they present themselves."
According to the report, in Canada, the shortage of product and very low current vacancy rates suggest there remains a real challenge for investor clients looking to buy and that directly translates into fewer opportunities for the brokers arranging their mortgage transactions.
Compounding the difficulty is the growing number of owners deciding to hold onto commercial property longer, or indefinitely, giving those same market realities – namely, the premiums of rent values.
Another trend likely to hurt Canadian brokers is the spate of investors now going south to take advantage of the kind of distressed opportunities Avison points to. While U.S. markets have started to claw their way back from the recessionary lows, commercial properties are still being snatched up at foreclosure auctions and other default-initiated proceedings.
Still, there is potential even there for Canuck brokers in helping investors access equity in their existing holdings in this country to pump that money in property stateside. A buoy Loonie is also working to their advantage.
