The couple, who work in financial-services software and met through colleagues, spent much of the pandemic working remotely from the lake house. “I really enjoy the vast contrast between the city and that rural part of the Hudson Valley,” she said. In 2017, they bought a lakeside cabin in Columbia County, just south of Albany, for around $222,000. But “we always got super discouraged at how expensive everything was and how little you get for your money,” Ms. Even from a landlord and development perspective, let’s get some ROI.Maria Pfeiffer and Jason Vogel moved into a brand-new Hell’s Kitchen building nearly 20 years ago, becoming the first residents of their sunny one-bedroom rental.Įvery few years, they would make a halfhearted attempt to buy a place. “That product is just sitting there, while the housing stock reaches critical levels across Canada. “All three levels of government need to come together to look at an overall real estate strategy, and figure out how we can speed up these commercial conversions,” Ash said. Alongside development fees, red tape has also been a barrier in “all types of new construction.” However, red tape, in the form of zoning amendments, applications, and approvals, is a significant setback to conversions in many cities. To date, 10 buildings have been approved under the Downtown Calgary Development Incentive Plan, which will create more than 1,200 new homes. The report points to a plan currently underway in Calgary, which provides a $75 psf subsidy to developers for converting office space to residential. “The retrofit and renovation activity not only brings desperately needed residential product online, but it also supports the surrounding retail shops and restaurants, transit systems, and the overall health of our downtown neighbourhoods.” “Commercial office markets are experiencing a transformational shift in the aftermath of the pandemic,” Alexander said. In what may be the “key to healthy, vibrant downtown cores,” 50% of markets reported conversion activity in the segment. With demand dwindling, there is growing interest in repurposing office space - particularly Class B and C buildings - into residential housing. In an effort to reduce costs, some companies are looking to reduce their physical footprint, while others are seeking to create social spaces in the hopes of enticing employees back to their desks. Meanwhile, the office sector, which Alexander called the “most lacklustre segment,” continued to struggle as hybrid work models persisted. There is also increasing interest in shared live-work-shop spaces, with the number of residential applications on commercially zoned properties on the rise across Canada. As a result, landlords are “pouring” investment dollars into major shopping malls. As such, industrial sales have risen in a number of markets, including Edmonton, Calgary, and Halifax.Īlthough demand has softened in most markets from the peak levels seen in 2022, industrial inventory remains “extraordinarily low,” adding increased pressure on prices.ĭespite the growth of online sales throughout the pandemic, the retail sector was “surprisingly robust,” with nearly 92% of markets reporting solid activity in shopping centres and storefronts. With property and lease values on the rise, investors and end users in British Columbia and Ontario began to look to other provinces for affordable distribution and warehousing facilities. The “sweetheart investment,” as denoted by RE/MAX Canada President Christopher Alexander, was industrial, which outperformed nearly every other asset class and saw all markets report strong sales and leasing activity. There is an overall confidence in the Canadian financial sector.” From a long-term point of view, things are looking positive. “The jury is still out, my crystal ball is still foggy, but there is a sense that a recession may have been dodged. “I think the outlook certainly looks good, particularly when we look at industrial warehousing and, office is going to sort itself out,” Elton Ash, Executive Vice President of RE/MAX Canada, told STOREYS. Q1 2023 marked the return of real estate investment trusts (REITs) to the market, which RE/MAX said is driving demand for industrial, multi-family, retail, and, to a lesser degree, office space, across Canada. RE/MAX Canada’s 2023 Commercial Property Report, released on Thursday, details the “positive indicators” that emerged in the sector in Q1, even as investment activity remained cautious. Despite ongoing struggles in the office market, Canada’s commercial real estate sector is poised to see an “upswing in demand” as strong industrial and retail markets drive growth.
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