Dave Curlee, New Media Producer
According to a report released by RealNet Canada Inc., Calgary commercial real estate investment remains down from its last peak and shows only modest growth in the first quarter of 2011.
The total number of transactions, including 77 transactions over $1 million, was up 18% from the previous quarter and overall investment of $389.4 million increased by 17% from the previous three months. The strongest sectors dominating the volume of investments were offices (27.2%), industry (22.0%), and retail (18.5%). The report noted that the market reached peak levels in 2007, and today it shows declines of approximately 63% in activity and 77% in overall capital investment.
However, the situation is not as bad as it may seem. “The average price per sale and the average price per square foot is actually higher than it was in 2004, 2005,” said Susan Thompson, business development manager of real estate for Calgary Economic Development. “If you take that big roller-coaster ride out in 2006-2008, there’s a fairly steady climb. You’ve got to watch out for those peaks and valleys. People get very focused on them but the trendline is just generally positive.” The Calgary Herald also noticed that the numbers by RealNet don’t include the recent sale of the Scotia Centre office tower — Homburg Canada Real Estate Investment Trust spent $116 million to acquire a 50% interest in the building.