Newsletter: August 2011

The first half of 2011 has been very healthy both in terms of number of transactions and overall value traded.

The chart below details the sales for each of the asset classes for the first six months of the past two years. The total number of sales for the past six months was up by 18% to 150 sales (over $500,000) compared to 127 sales in the same period of 2010. Further, the overall value transacted has shown a significant increase from the previous year. The overall value of transactions for the first six months was nearly $527 million, up 75% from the same time period the previous year. The office and land segments were both up significantly over the same period last year.

2010 2011
Property Type # of Sales Value # of Sales Value
Industrial 16 $46,209,483 20 $66,802,500
Multi-Family 31 $77,168,500 24 $77,414,000
Retail 22 $38,696,500 20 $28,504,900
Office 19 $34,083,622 24 $122,093,379
Land 36 $98,758,690 58 $186,030,671
Special 3 $5,700,000 4 $46,018,001
Total 127 $300,616,795 150 $526,863,451

There were a total of 39 sales reported in the month of June with a total value of $119,613,688. Retail building sales accounted for 2.9% of the total, industrial buildings 14.7%, office buildings 24.6%, apartment buildings 29.9%, special buildings 0% and vacant land 28.0%.

Sales data has been provided by RealTrack, Inc. For more information visit http://www.realtrack.com or call 1-877-962-9033

SALES

There were four transactions in the RETAIL market with a total value of $3,454,000. The most notable transaction was the purchase 2 Ullswater Drive in Nepean. The property was purchased by 2284638 Ontario Inc. from Private Individuals for $1,065,000 or $213/sf. It is improved with a single-storey retail strip plaza that was 100% leased at the time of sale.

There were five INDUSTRIAL building sales during the month of June with a total value of $17,525,000. 400-530 Industrial Avenue was the largest transaction transferring from 2924536 Canada Inc. and a group of Private Individuals to Metro Ontario Real Estate Ltd. for $7,750,000 or $30/sf. It is improved with two older buildings that were constructed in various stages between the 1950's and the 1980's. The property was purchased by the tenant.

Another large transaction in the industrial segment was the sale of 401 Coventry Road. The property was purchased by Megha Holdings Inc. from Private Individuals for $3,850,000 or $131/sf. It is improved with a single-storey industrial building that was constructed in the late 1970's.

44 Iber Road also sold during the month of June. The property was purchased by 1248800 Ontario Inc. from 2229798 Ontario Inc. for $2,525,000 or $126/sf. It is improved with a single-storey industrial building that was constructed in the late 1980's. The property previously sold in February 2010 for $1,775,000.

Another notable transaction was the sale of 800 Belfast Road. The property sold to J&J Macartney Realty Inc. from Dormor Holdings Inc. for $2,100,000 or $81/sf. The property is improved with a single-storey partially refrigerated industrial building. Joel Freedman and Derek Parker of Metro Suburban Realty were the listing agents with regards to this transaction. There were five OFFICE building sales with a total value of $29,429,000. The most notable transaction was the sale of 100 Murray Street. The property sold to Sun Life Assurance Company of Canada from 2042690 Ontario Inc. for $18,000,000 or $339/sf. It is improved with a five-storey office building with ground floor retail component that was constructed in 2006. The property was approximately 71% occupied at the time of sale. Brian Seymour, Peter Senst and Jaysen Smalley of CB Richard Ellis were the listing agents with regards to this transaction.

The next largest transaction was the sale of 2555 St. Joseph Boulevard. The property was purchased by 1850082 Ontario Ltd. from Hepta Consultants Ltd. for $5,000,000 or $111/sf. It is improved with a four-storey medical office building. The property was 87% occupied by 36 tenants at the time of sale.

Another transaction worth mentioning was the sale of 2400 St. Laurent Boulevard. The property sold to Huntington Ottawa Properties Inc. from 2400 St. Laurent Corp. for $3,850,000 or $124/sf. It is improved with a single-storey flex type office/industrial building that was constructed in the late 1980's. The building was fully leased to a single tenant at the time of sale. Graeme Webster and Marc Morin of District Realty Corp were the real estate agents with regards to this transaction.

There were nine transactions in the APARTMENT market during the month of June with a total value of $35,720,000. The sale of 1170 Fisher Avenue made up a large portion of that sum. The property was purchased by 1170 Fisher Apartments Inc. from Fisher Avenue Estates Ltd. for $27,000,000 or $100,000/unit. It is improved with a nine-storey L-shaped apartment building that was constructed circa 1970.

There were no transactions in the SPECIAL building market.

There were 16 vacant LAND transactions during the month of June for a total consideration of $33,485,688. Of the 16 transactions, there were six residential land sales, four commercial land sales, three institutional land sales, two future growth land sales and one industrial land sale. The most notable transaction was for a 48-acre parcel of future development land located 4840 Bank Street. The property was acquired by 4840 Bank St. Ltd. from Epcon Enterprises Ltd. for $5,440,000 or $113,340/acre. It is reported the purchaser intends to develop the property with a mix of residential and commercial uses in the next several years.

The next largest transaction was the sale of a 23-acre parcel of land on the east side of Portobello Boulevard, in the east end of Ottawa. The property was purchased by Mattamy (Tenth Line) Ltd. from the City of Ottawa at a registered consideration of $4,269,800 or $185,482 per acre. The deal is part of a land swap for a 49-acre woodlot located on the east side of Cedarview Road in Barrhaven.

1687 Merivale Road represents another large transaction. The 3.5-acre parcel was purchased by Claridge Homes (1693 Merivale Phase 1) Inc. from Toys R Us (Canada) Ltd. for $3,750,000 or $23/sf. It is reported the purchaser intends to develop the property with condominium apartment buildings as well as a retirement home.

Claridge Homes also closed on 141 George Street. The property was transferred from Donley Investments Ltd. to Claridge Homes (George St) Inc. for $3,175,000 or $291/sf. The property is currently leased to a restaurant for another two years. Finally, the last major transaction was the sale of 127 & 145 Presland Road. The property sold to 145 Presland Road Inc. from Institut des Franciscaines Missionaires de Marie d'Ontario for $2,500,000 or $20/sf. The land is currently improved but the purchaser intends to redevelop the property with a 307-unit four to eight-storey condominium apartment building.

NEWS

The local unemployment rate as reported by Statistics Canada for the month of June continued to decrease to 5.6% from 5.9% in May and 6.3% in April. The provincial rate for June also decreased from 7.9% in May to 7.7%. The national overall unemployment rate remained unchanged from the prior month.

According to CMHC's news release, the number of residential units under construction decreased 8.7% this year over last year to 4,717 units. That said, Housing Starts for the month of June have shown a significant 57.8% increase year-over-year, from 384 units in 2010 to 606 units in 2011. Year-to-date housing starts have decreased 8.6%, from 2,641 units in the first half of 2010 to 2,414 units in the first six months of the current year.