Appetite in Canadian real estate investments remains strong despite lull: survey

By Mario Toneguzzi, Calgary Herald

Canadian real estate investors are cautiously optimistic that a fast recovery is on the horizon even though the market has yet to reach its lowest point.

But according to Colliers International’s 2010 Global Investor Sentiment Survey, 65% of Canadian institutional and private real estate investors said they are considering further acquisitions over the next 12 months, mirroring the global trend (64%).

The global survey of more than 240 major real estate investors (including 26 large Canadian institutional property investors) with a total investment portfolio of over $300 billion, also found a strong appetite for domestic investments. The vast majority (85%) of Canadian respondents who indicated acquisition plans intend to focus on the domestic market, especially in locations such as Toronto (27.8%), Vancouver and Montreal (16.7% each), Edmonton and Calgary (14.8% and 11.1% respectively).

Canadian real estate investments

The lack of appetite for foreign investments is also reflected globally with eight out of ten respondents having no offshore portfolio or intentions to invest overseas.

“On a risk adjusted basis, Canadian investors still see Canada as a preferred investment destination that offers a higher return on investment compared to the U.S., in part because of the turmoil that still lingers south of the border,” said Milton Lamb, Chair, National Investment Team, with Colliers International in Canada. “Additional reasons respondents gave for focusing on domestic investments range from the quality of assets to diversification of income stream, availability of capital or better valuation matching income.”

The survey also found that 73% of Canadian investors feel that access to capital became easier over the past year and 54% say the movement toward easier access to debt to continue.

The inaugural 2010 Global Investor Sentiment Survey was conducted by Colliers International between Feb. 15 and March 1 and includes responses from 244 major institutional and private investors whose combined investment portfolio exceeds $300 billion.

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Contact the Jeffrey Team for more information  –  416-388-1960

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