Greater Vancouver’s residential land market kicked off 2014 with its second-best quarter on record (for over-all dollar value of transactions), according to a report by RealNet Canada.
The majority of these transactions, which included transactions worth between $1 million and $84 million, took place near transit and SkyTrain corridors. The demand for land for high-density developments has been very steady, and has driven other asset classes including retail and office space, which tend to get folded into large mixed-use developments along the transit corridors. “The residential land market has a trickle-down effect on asset classes like retail and even industrial.” the report says, which is an outcome of the increase in amenities being built near affordable, high density residential developments.
The RealNet report also tallied transactions around the region in these other asset classes including offices, industrial buildings, apartment buildings, retail, hotels and other types of non-residential land. A total of 329 transactions worth $1.5 billion across all asset classes were registered in the first-quarter, according the report. That figure was up about one per cent from the previous quarter, with residential land being the most active sector, at 36 per cent of activity. Deals in the non-residential land market (industrial, commercial, investment) also surged ahead in the first quarter of this year, exceeding the $300 million mark for only the fifth quarter in the last nine years.
At Frontline Real Estate Services we are seeing “a strong demand for quality development sites” says Justin Mitchell, Director of the Development Land sector, “evidenced by the activity on our listings and requests for new opportunities from strong developer clients”.
“The last six months have been the best six months ever recorded in terms of over-all investment in the Greater Vancouver commercial real estate market,” Paul Richter, director of research at RealNet Canada wrote in the report. “Every single asset class is operating at pretty high levels historically speaking, and kind of firing on all cylinders,” he said. “Deals in excess of $20 million across all asset classes, and a higher volume of transactions throughout the lower thresholds has created a growing and well balanced market.”