West Vancouver has long been recognized as an affluent, limited-growth, high barrier to entry market among all asset classes. As a result, there has been a limited amount of transaction activity over the past several years. Valuations remain stable with continued growth as a result of lack of new supply and increasing rental rates. Current market dynamics for each asset class in West Vancouver are summarized below:

Office

Office space in West Vancouver comprises only a fraction of that available on the North Shore and is limited primarily to a handful of buildings in the Marine Drive and Bellevue areas. The balance of available space is typically in smaller strata or mixed use buildings which reflects the demand base of professional and medical services.

There have been few office transactions in this market, with pricing for larger freehold assets typically ranging in  the $450-500 per sq ft range, with cap rates of between 5.0-6.0%.

Retail

Retail continues to be in high demand in West Vancouver as an investment, particularly due to the ongoing demand on behalf of retailers to be part of this market and no new opportunities to develop. Well established nodes include Park Royal, the Marine Drive corridor, Dundarave Village and Caulfield Village Shopping Centre.

Retail assets that have traded over the past 5 years have typically been streetfront retail, with most sales occurring in the Marine Drive area. Cap rates for retail tend to be between 5.0% and 6.0% in this market, and have exhibited average prices as follows:

Apartment

The lack of sales activity for multifamily assets in West Vancouver reflects the desirability of the market from an income perspective, particularly given high demand spurred by prohibitive housing costs in the area, an aging population, and lack of opportunities for new development.

Apartment buildings that have traded have typically been at capitalization rates around 4.0% and at prices per unit of approximately $300,000 depending on the age of the building.

Bellevue Tower, 195 21st Street, a 126 unit concrete highrise apartment tower sold in June 2010 to Hollyburn Properties for $36,500,000, 3.8% cap rate.

Quick Facts on Apartment Market:

• Overall vacancy rate is 0.6%
• Overall average rent is $1,462
• 2,329 total private apartment units (not including rented condos)
• 2.1% average rent growth in 2010

Source: CMHC

For information on current opportunities in this market, contact Simon or David.

According to Colliers’ Q2 2012 Metro Vancouver Office Market Report, the Metro Vancouver office market maintained its stability once again this quarter, with the
vacancy rate decreasing minimally from 7.7 percent last quarter to 7.6 percent this quarter.

Q2 highlights:

• The Metro Vancouver vacancy rate decreased minimally from 7.7 percent in Q1 2012 to 7.6 percent in Q2 2012
• The Downtown Vancouver vacancy rate decreased to 3.5 percent this quarter, down from 3.8 percent last quarter
• Investment activity Downtown was reasonably strong, with the sale of Bentall V and several significant firms deals in place
• The Suburban vacancy rate remained unchanged from last quarter at 11.2 percent and the market as a whole was relatively slow
• Broadway Tech Centre Building 6 commenced construction this quarter after it was revealed that Golder Associates preleased approximately 130,000 square feet

David Taylor and Simon Lim of Colliers International have acted on behalf of the Vendor in the sale of 5970 East Boulevard, a 9,600 sq ft office and apartment building located in the prestigious Kerrisdale are of Vancouver. The property is zoned C-2 and was fully leased at the time of sale. The purchase price was $3,500,000, representing $347 per sq ft.

The City of Vancouver is holding an open house for 320 Granville Street, a proposed 32-storey office building with a density of 25.5 FSR and 380,000 sq. ft.

The Open House will be a “drop-in” event where you can view the proposal. City staff and the applicant team will be available to answer your questions and receive your comments.

Community Open House
Date: Thursday, July 12, 2012
Time: 5 – 8 pm
Place: The Landing (atrium)
375 Water Street

108 & 116 East Broadway, two retail buildings located on the South side of Broadway near Main Street, have sold for a combined $4,900,000, representing a cap rate of approximately 3.0%. The properties are zoned C-3A, and have a site area totaling 9,520 SF, equating to a price per buildable sq ft of $157.00.

The buildings are currently occupied by a thrift store and a mattress store. The purchaser was a local private investor. The property had been listed with Cushman Wakefield.