Newsletter: August 2012

Sales in the first half of 2012 have nearly doubled the overall value traded in the first half of 2011 despite a 10% drop in trade volume. This surge can be attributed to several large transactions within the multi-family and office market segments.

The chart below summarizes 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 down 10% to 134 sales (over $500,000) compared to 150 sales in the same period of 2011. 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 $916 million, up 74% from the same time period in the previous year.

  2011 2012
Property Type # of Sales Value # of Sales Value
Industrial 20 $66,802,500 18 $36,270,000
Multi-Family 24 $77,414,000 25 $285,838,900
Retail 20 $28,504,900 22 $46,510,000
Office 24 $122,093,379 16 $314,704,000
Special 4 $46,018,001 4 $85,339,250
Land 58 $186,030,671 49 $147,155,749
Total 150 $526,863,451 134 $915,817,899

There were a total of 24 sales reported in the month of June with a total value of $208,886,815. Retail building sales accounted for 1.6% of the total, industrial buildings 3.5%, office buildings 2.1%, apartment buildings 80.3%, special buildings 0% and vacant land 12.5%.

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 two transactions in the RETAIL market with a total value of $3,400,000. The largest transaction within the segment was the sale of 3071 Carling Avenue. 6422934 Canada Inc. sold the property to 8116202 Canada Inc. for $2,000,000 or $174/sf. It is improved with a single-storey retail strip plaza. The building was leased to four tenants at the time of sale.

There were four INDUSTRIAL building sales during the month of June with a total value of $7,400,000. 1780-1800 Woodward Drive represents the largest industrial building sale for the month. 1800 Woodward Inc. acquired the property from Gabrec (Donhardon) Holdings Limited for $2,475,000 or $100/sf. It is improved with a single storey multi-tenant industrial/showroom building that was constructed in 1965. The building features six grade level loading doors and a clear ceiling height of 16 feet. The property was 79% occupied at the time of sale. Jason Shinder & Charles Mirsky of District Realty Corp were the listing agents with regards to this transaction.

580 Industrial Avenue represents another large transaction within the industrial market segment. The property sold to RD Holding Corporation from Private Individuals for $2,050,000 or $171/sf. It is improved with a single storey warehouse that features eight drive-in doors and a clear ceiling height ranging between 12 and 14 feet. The purchaser intends to occupy the building which was vacant at the time of sale. Joel Freedman of Metro Suburban Realty and Sina Saramgar of Synercapital Real Estate Investment Services Inc. were the agents involved with this transaction.

There were three OFFICE sales during the month of June with a total value of $4,385,000. 9 Capella Court represents the most significant transaction within the segment. Serco Realty Inc. acquired the property from 1394935 Ontario Inc. for $2,390,000 or $134/sf. It is improved with a two-storey Class “B” office/warehouse building that was constructed in 1988. The warehouse component features five dock-level doors and a clear ceiling height of 22 feet. Ed Belanger and Geoffrey Godding of Colliers International were the listing agents with regards to this sale.

There were seven transactions in the APARTMENT market with a total value of $167,690,000. The majority of this sum can be attributed to a portfolio transaction consisting of 1,318 rental apartment/townhouse units which TransGlobe Apartment REIT sold to Timbercreek Asset Management Inc. for $154,000,000 or $116,844/unit. The properties are located along Baycrest Drive, Heron Road, Sandalwood Drive, Walkley Road and Cedarwood Drive within the Heron Gate neighbourhood. Andrew Phillips, Jamie Ziegel, David Bloomstone, David Barnes and Elliot Altberg of TD Securities Inc. were the parties involved with facilitating this transaction.

The next largest transaction was the sale of 267 Greensway Avenue, 20-80 and 29-69 Mark Avenue. The properties sold to 1479151 Ontario Inc. from L. Petegorsky Realty Limited for $6,575,000 or $60,880/unit. They were improved with 12 identical two and a half-storey walk-up apartment buildings that were constructed circa 1960.

623-647 Carson’s Road represents another significant apartment transaction. Carson Hill Apts. Ltd. acquired the property from 739531 Ontario Limited for $5,000,000 or $119,048/unit. It is improved with seven, two and a half-storey sixplex apartment buildings that were constructed in 1963.

There were zero transactions in the SPECIAL building market.

There were eight vacant LAND transactions during the month of June for a total consideration of $26,011,815. Of the eight transactions, there were three residential land sales, one industrial land sale, two rural/agricultural land sales, one future growth land sale and one institutional land sale. The largest transaction was for 136 acres of future growth land located on the west side of Huntmar Drive, north of Maple Grove Drive. D.D. Kanata Ltd. sold the unserviced parcel to 2325483 Ontario Ltd. for $11,750,000 or $86,384/acre. It is reported the property will undergo rezoning to accommodate mixed use development. Erik Falardeau of CB Richard Ellis was the listing agent with regards to this transaction.

The next largest transaction was the sale of 774 Bronson Avenue and 557 Cambridge Street. The 38,955 square foot parcel of residential land was acquired by Samcon Cambridge Inc. from Crainplan Ltd. for $5,095,000 or $131/sf. The purchaser is proposing to develop the site with two condominium apartment buildings, 8 and 12 storeys in height. Quintin Colaiacovo and Kevin McMahon of CB Richard Ellis were the agents involved with this transaction.

Another significant transaction was the sale of a 7.252 acre parcel of institutional land located on the southeast corner for Kelly Farm Drive and Bradwell Way. The Ottawa Catholic District School Board acquired the property from 1374537 Ontario Ltd. and Findlay Creek Properties Ltd. for $2,908,000 or $400,993/acre. They intend to develop the property with an elementary school.

1040 Somerset Street West represents the final significant land sale for the month. The 14,434 square foot residential parcel sold to Claridge Homes (Hintonburg) Inc. from Compucorps Mentoring Inc. for $2,100,000 or $145/sf. The purchaser intends to develop the site with a condominium apartment building.

NEWS

The local unemployment rate as reported by Statistics Canada for the month of June fell to 5.9% from 6.1% in May. The provincial rate saw a slight decrease from 7.8% to 7.7%. The national overall unemployment rate also decreased slightly from 7.3% to 7.2% month over month.

According to CMHC’s news release, the number of residential units under construction during the month of June increased 28.6% year over year to 6,064 units. Housing Starts for the month increased 3.6% from 606 units in 2011 to 628 units in 2012. Year-to-date, housing starts have increased 57.3%, from 2,414 units in the first half of 2011 to 3,798 units in the first half of 2012.