Commercial real estate transaction value has hit a new record high this quarter, according to a new report by CBRE Canada.
The second quarter of 2018 posted $16.5 billion in commercial transactions, up 38 per cent from last quarter’s previous record of nearly $12 billion and 105 per cent above the five-year quarterly average. Combined, investment volume for the first half of 2018 is $26.8 billion – an all-time high for a half-year period.
Transactions in Vancouver and Toronto drove the bulk of the activity, with just two sales claiming 45 per cent of the quarter’s total dollar volume. Toronto-based Choice Properties Real Estate Investment Trust purchased Canadian Real Estate Investment Trust, while U.S.-based asset manager The Blackstone Group acquired B.C.-based Pure Industrial Real Estate Trust.
“It’s not surprising that investment volume was the strongest ever in Canadian history. In fact, the average deal size in Q2 was up 67 per cent year-over-year to $9.4 million, which is reflective of the size and significance of the investors in real estate today,” said Peter Senst, president of Canadian Capital Markets at CBRE Canada.
Toronto transactions accounted for a third of all sales at $5.7 billion, while Vancouver clocked an impressive second at over $3.2 billion – up 91 per cent over the five-year average.
Calgary saw $2.5 billion in transactions, led by Oaktree Capital Management’s $107 million purchase of Calgary’s First Tower office building.
Industrial outsold all asset classes, representing 37 per cent of the quarter’s dollar volume at $6 billion.