Canada has led G7 nations in GDP growth over the last decade and diverse job growth has driven unemployment below 6.0%. With solid employment prospects, wage growth and robust business spending, it should come as no surprise that commercial real estate fundamentals are strong.
In 2017, Canada recorded the highest commercial real estate investment volume in the nation’s history at $43.1 billion, setting back-to-back annual records and contending for a third consecutive year of ground breaking investment volumes despite rising rates and stricter underwriting in 2018.
Canada continues to be in high demand, attracting those pursuing education, employment, investment and travel. The flow of capital and people bodes well for Canadian commercial real estate in 2018 and beyond.
After two years of recession, Calgary’s economy seems to be on the rebound as GDP grew by 6.9% in 2017 and is expected to grow again in 2018. The unemployment rate has decreased from 9.4% to 8.7% since 2016 and job growth is expected to expand by 2.0% in 2018.
Despite an overall increase in ecommerce activity across Canada, the retail market in Edmonton has remained stable. Food and drug anchored sites are in high demand with cap rates comparable to pre-recession times. The retail market has also seen growth from the new cannabis industry. With the legalization of recreational cannabis use in Canada slated for October 17th, 2018, the retail market is quickly ramping up in preparation.
(Source: CBRE 2018)