PLAN B: And we’re back! For another year of re-pricing, recovery and the unknown in the commercial and industrial real estate industry. Buyers and sellers are still trying to figure out what the market will bear.
Did you know the Bank of Canada raised interest rates 7 times in 2022? And possibly more hikes to come. Low risk anything is the “in” thing now.
According to a recent G & M article, banks are offering developers less money (65 to 70%) and the developer has to come with 10 to 20% bridge financing (8 or 9% rates for this!). It’s causing reduced competition for deals and property values are up in the air. The good news: industrial real estate (warehousing, fulfillment, data centres and self-storage) is still a good investment.
Despite predicted stability mid-year, a delay between approved projects and actual digging is reality. Nothing new. But according to a PwC’s Emerging Trends in Real Estate 2023 assessment, “the long-term outlook for the Canadian real estate market is positive.” Hope so. Back to plan B–woodworking.