Commercial Property: Four Canadian Cities To Present Opportunities For Foreign Property Buyers

Jones Lang LaSalle in a new report forecasts rising demand from global investors for commercial properties such as offices, shopping malls and factories in four Canadian cities, such as Toronto, Vancouver, Montreal and Calgary.
The notion of a new wave of investment in commercial properties is troubling to some Canadian real estate players who are concerned that valuations here are already lofty, and that an asset bubble could form if investors continue to bid up the price of properties.
The 10-year annualized total return from Canadian commercial real estate is 11.9 per cent, second only to South Africa, according to Investment Property Databank Ltd.
Those stellar returns have spurred investors to continue to pour money into the market, but so far most of that has come from Canadians.
As Jones Lang LaSalle points out, Canada has one of the lowest proportions of foreign capital invested in its real estate market in the world. The market is dominated by local pension funds, insurers and real estate investment trusts. Those Canadian players have had plenty of funds to invest, and have chosen to increase the proportion of their investment portfolios that is dedicated to real estate because of the strong returns. Their knowledge of the local markets has given them an edge over foreign players when it comes to winning key assets.

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