Utility costs may be a wild card, but 2001 looks like a good year for the Calgary commercial real estate market.
The outlook is good, but some signs need watching after the drop of the Nasdaq market, says Bill Partridge, executive director of the Building Owners and Managers Association of Calgary.
Some suppliers have closed their doors as the dot-com market was saturated with telecommunications suppliers, he adds.
Tim Crough, manager of real estate for Toole Peet and Co., says there is good demand for office and commercial space. There is a possibility of a new tower being built, and the vacancy rate should be a healthy six to 10 per cent.
The rising costs of electricity after deregulation will also be a market factor, he adds.
Noting the importance of oil and gas to Alberta’s economy, Partridge says vacancies could drop to five per cent by the second quarter, if oil and gas prices stay level. Larger tenants — those needing more than 50,000 sq. ft. — will have less choice in space and net rents will go up.
All this assumes a healthy economy. If the economy takes a turn for the worse, so do real estate projections, he adds.
Crough says residential real estate might benefit from high oil prices. “I think it’s going to be a good year,” he says. “I think some of the money in oil and gas is going to start filtering on through in the spring.”
The size of the housing inventory means prices won’t rise a lot, he adds.
The Alberta advantage gets credit for keeping the province the country’s hottest housing market in a Century 21 national price survey released last week.
The survey compared prices in December 1999 to December 2000.
Don Lawby, president of Century 21 Real Estate Canada Ltd., said that the energy sector will continue to power the province, although house sales are likely to stay even with last year’s. Lawby said Alberta remains Canada’s hottest housing market due mainly to the Klein government’s ability to create the economic conditions that attract people and businesses to the province.
Nationally, the market appears likely to weather stock-market turbulence and the threat of higher inflation.
Lawby said people with money are still buying high-priced houses in all provinces. They’re likely to keep doing it despite the hammering tech stocks have taken.
B.C. is likely to remain the country’s slowest housing market.
Century 21’s survey uses a typical house representing the majority of homes in the community. The survey tracks the change in this, rather than the average or median price.
The biggest increase in Alberta was 10 per cent in northwest Edmonton and the biggest drop was 2.8 per cent in the Woodbine area in southwest Calgary. Houses in Lake Midnapore went up 3.9 per cent and in northwest Calgary 6.2 per cent.
Calgary real estate agents won’t be receiving some data they say helps them do their jobs under a Freedom of Information and Privacy ruling announced last week.
Information and Privacy Commissioner Bob Clark upheld the city’s decision not to disclose the names and mailing addresses of property owners to the Calgary Real Estate Board.
“First off, we’re disappointed,” said Ron Esch, executive vice-president of the industry group. “It’s our contention that the information we were receiving before was not in violation.”
City spokesman Peter Brodsky said the city felt it was working in the spirit of the Freedom of Information and Privacy Act when it refused the request.
“Information collected for one purpose can’t be used for another purpose — that’s the gut of the FOIP ruling,” said Brodsky.
Clark found that FOIP applies to the information because the property owners’ names and addresses were collected for tax purposes. He therefore upheld the city decision.
The city had earlier agreed to provide assessment information but not the owners’ names and addresses.
Esch told Business Edge that the information on CD-ROMs helped real estate agents do their jobs. It’s important that agents get the names of all the owners on a title when listing property. The city had provided the information since 1983, but stopped when the privacy legislation took effect, he said. n n n A Calgary company with real estate interests has started trading on the Swiss stock exchange in Zurich.
Proprietary Industries Inc. said in a release that the December listing in Switzerland will provide it with more access to European capital markets. It will provide European investors with more direct access to PPI corporate information. Proprietary is included in the TSE 300 Composite Index.
Proprietary has real estate, natural resource and related assets and investments. It trades as PPI on the Toronto Stock Exchange and closed Friday at $5.10, down five cents on the day.
CIBC announced cuts in its mortgage rates last week.
The bank said in a release it was dropping rates by .10 per cent to .30 per cent for various mortgage products. The new rates range from 7.4 per cent for a one-year closed mortgage to 8.4 per cent for a 10-year closed mortgage.
The Canadian Imperial Bank of Commerce trades as CM on the Toronto Stock Exchange and closed Friday at $47, down 80 cents.
Web Watch:
www.proprietaryinc.com
www.cibc.com
www.boma.ca
www.oipc.ab.ca
