Continuing concern over commercial real estate

Ongoing concern regarding the sustainability of the Canadian commercial real estate market’s prosperity is reflected in the Q4 results of the Canadian Real Estate Sentiment Survey, released by REALpac and FPL Advisory Group.

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Key findings are as follows.

• While many are optimistic about the prospects of continued economic recovery within the U.S., international conditions elsewhere dim the go-forward outlook.
• There are mixed views as to whether cap rates can continue to compress; some respondents believe any interest rate increases will be offset by strong institutional demand for real estate.
• Debt availability continues on, fueled by a low cost of capital; at the same time, some note the conservative nature of Canadian lenders and how that may play into the future.
• Equity availability is strong, reflected by investor demand and allocation preferences for real estate.

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Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.