Canada\u2019s commercial real estate (CRE) sector could reach a record-breaking level of investment in 2020 according to CBRE.<\/p>\n
The global real estate firm says that the solid start to the year could set the stage for $50 billion of this year as global players view it as a relatively safe haven.<\/p>\n
With real estate investors considering Canada a top destination for both domestic and global capital, the CRE sector should see a sizeable share of the record level of available capital.<\/p>\n
\u201cA relentless bull market, macroeconomic tailwinds and supportive immigration policies have allowed Canada\u2019s commercial real estate market to gather serious velocity heading into the new decade,\u201d said CBRE Canada Vice Chairman Paul Morassutti.<\/p>\n
But the potential for the market is tempered by some risks.<\/p>\n
\u201cThere are challenges ahead, including rising rents, limited office and industrial space, new technologies and the all-important issue of climate change,\u201d added Morassutti. \u201cBut ingenuity across our industry has demonstrated that creative solutions and skillful management of these issues can ensure the real estate market\u2019s ongoing success.\u201d<\/p>\n
Where the cash is headed<\/strong> With domestic investors competing with global players, their attention is shifting to those smaller markets such as Ottawa, Waterloo Region, Hamilton, the B.C. Interior and the province of Quebec.<\/p>\n The downtown office market remains tight and nationally 70% of the construction underway in this segment is pre-leased.<\/p>\n Half of industrial construction underway is also pre-leased and with large bay units harder to obtain, tenants are looking to multiple units in smaller markets.<\/p>\n Study findings<\/strong>
\nThe typical focus of CRE investment capital is core assets in major centres but there will also be more investment heading to smaller cities.\u2019<\/p>\n
\nAmong the trends ahead for Canadian CRE investment, CBRE has identified three key findings:<\/p>\n