Here’s a snapshot of currently selling downtown condo projects in terms of inventory. Also included are projects likely to be released in the next 12 months. Overall, available inventory seems to be in healthy and balanced territory, though some larger upcoming projects scheduled to be offered in the next two years may have an impact on the market with well over 2,000 units.
The site of the former Steveston secondary in Richmond sold to Polygon Homes for $41,125,000.
“The board is enthusiastic about what this means for our district,” said Donna Sargent, board chair at Richmond School District No. 38. “The sale of these lands provides us with funding that can be used for other capital projects and will ensure the legacy of Steveston will remain within the Richmond community.”
The 13-acre site will be split into eight acres sold to Polygon and five acres reserved for a park. There are no conditions on the sale and any rezoning will be done with the city.
12.58 acre Steveston Secondary Site
The secondary school closed in June, 2007 and was merged with the nearby London secondary to become Steveston London secondary in September, 2007.
There is a sizable new office block with a design not like any other on the North Shore coming to central Lonsdale.
City of North Vancouver council voted Monday night to approve a five-storey, 9,600-square-foot retail/office building on the corner of 12th Street and Lonsdale Avenue. The site is currently home to a convenience store, a Vietnamese restaurant, a pizza restaurant as well as a laundromat and hair salon.
The building’s facade is like most glass curtain wall designs used in office towers, except it is rotated 45 degrees and divided up into a mesh. The outer wall then curves outward and turns into an awning over the sidewalk.
The proposal exceeds the density allowed on the site, however council agreed to amend the official community plan because the building includes “employment generating space,” and because the developer is contributing $172,800 to the city’s community amenity fund.
As reported by CBC, the Competition Bureau has ordered Sobey’s Inc. to sell 23 stores in Western Canada before it will approve its $5.8-billion purchase of grocer Safeway Canada.
The Nova Scotia-based supermarket chain says it has agreed to put the supermarkets on the block and it expects to close the acquisition of the Canadian assets of Safeway in early November.
The two affected Metro Vancouver properties are:
Tsawwassen Safeway
Safeway Tsawwassen, 1143 56th Street, Tsawwassen
This is a 4.5 acre site in the heart of Tsawwassen’s commercial area. The property is zoned C-1. It is assessed at $11,977,000.
New Westminster Thrifty’s
Thrifty Foods Sapperton, 270 East Columbia Street, New Westminster
The Thrifty’s is located as part of Wesgroup’s Brewery District project and does not have redevelopment potential.
As we’re now well into Q4 2013, a brief look at average cap rates in Metro Vancouver shows (surprise!) no significant change from 2012. Underpinned by an environment of continually cheap debt, cap rates have been flat or remain in slight decline, and now 100 BPS below the rolling 10 year average of 6.2%.
Average Cap Rates 1993-2013
Of course, only in rare cases are Vancouver buyers truly finding yield; it is often more of a ‘safety’ play. With a healthy supply of potential (and anxious) private equity buyers that have amassed significant, undeployed cash reserves in reaction to depressed and uncertain market conditions in recent years, cap rates are being bid down now as much as ever. This, coupled with fiscal authorities in both Canada and the United States continuing to maintain interest rates at historically low levels have resulted in the continuation of historically low cap rates in Vancouver.
The first signs of a shift in this trend may already be occurring with a slight downward trend in transaction activity so far in 2013. A continuation of this trend in 2014 combined with a changing economic/interest rate environment and potentially volatile leasing markets (particularly in office) may finally exert upward pressure on cap rates.
…just don’t tell owners…