Commercial real estate investment declines in Calgary

                                                     Mario Toneguzzi, Calgary Herald, Calgary Herald

Commercial real estate investment in the Calgary market was down in the third quarter of this year, according to a new report by RealNet Canada Inc.

The report said total dollar volume in the city reached $722 million, off by 13 per cent from the previous quarter. However, larger investments were up, with 148 transactions over $1 million, a 48 per cent increase over the second quarter.

“Despite the uneven performance in the office and retail markets, capital continues to flow in the Greater Calgary area due to steady industrial and land sectors,” said Paul Richter, director of research for RealNet Canada.

In the third quarter, investment volumes were up in four of seven asset classes, with the retail and apartment asset classes generating the greatest improvements from the previous quarter.

There were 27 retail deals in the quarter — an improvement of 80 per cent and the fourth most active quarter in the past 10 years. The value of those deals was $153.6 million, a 37.6 per cent increase.
The apartment market “rebounded from a five-year trough,” the report said, with investment volumes up 248 per cent to $128.9 million.

“The third quarter … outperformed a combined first and second quarter,” said the report.
The office market plummeted from $457.2 million in the second quarter to $8.8 million in the third quarter. The industrial market saw investment reach $177.9 million in the third quarter, up from $102.5 million in the previous quarter.

The hotel asset class dropped to $10.8 million from $15.9 million; industrial land fell to $108.2 million from $124.2 million; and residential land was up to $134 million from $60.7 million.