Regina commercial real estate market remains tight with low vacancies; growth expected to continue through 2013

Avison Young releases its Regina 2012 Year-in-Review/2013 Market Forecast

REGINA, March 1, 2013 /CNW/ - Positive economic indicators, a record year for building-permit values in 2012, volatile construction costs, and a string of large-scale initiatives are highlighted in Avison Young's 2012/2013 report covering the Regina commercial real estate market.

Strong performance across all asset classes, additional class A office space and industrial land, lack of investment product, and healthy retail sales characterize the strong performance foreseen for the commercial real estate market in Regina where landlords clearly have the upper hand.

These are some of the key trends noted in Avison Young's 2012 Year-in-Review/2013 Regina Market Forecast, released today.

"The provincial and regional economies have witnessed a couple of small bumps in the road but, by and large, they continue to trend in a positive direction - and in a sustainable manner," comments Richard Jankowski, Managing Director of Avison Young's Regina office. "There has been sustained growth in the manufacturing sector, expansion and diversification in the resource sector, and a resurgence in agriculture. All of this activity had a positive impact on the commercial real estate industry throughout 2012 and we expect this growth to continue in 2013 and beyond."

Jankowski says the continued growth in investor and business interest in the province is what led his office to publish its first-ever all-encompassing market report.

"It is great to see a new office tower go up in our downtown - the first in 20 years," states Avison Young Principal Dale Griesser. "As a result, the office market gained some breathing space during the past year; however, Regina remained the national leader in terms of low vacancy rates. Of equal significance is the current growth in the fringe and suburban areas as new and existing tenants look for space to fit their business needs."

He continues: "The office construction planned and underway is at the highest pace for adding inventory in recent memory, and long overdue to satisfy overheated demand."

The city's industrial market has also been very active in both building construction and land development. According to Avison Young sales associate Jeff Sackville, who specializes in industrial sales and leasing, the market is expected to stabilize in 2013 after a strong performance in 2012.

"Lease rates have flattened out now that the market correction has moved through this sector. It has been good to see the City of Regina develop new industrial land, and despite the lift in the purchase price, demand is strong as new businesses locate to the area," explains Sackville. "We'd like to see that happen outside the city as well, where interest for larger-scale developments has been evident. It is good to have balanced options."

The retail sector is considered a turbulent market in transition, according to Avison Young sales associate Joe Trudelle who specializes in retail and office sales and leasing. "On the one hand, it is very exciting to see our city gain the attention of U.S.-based retailers who now want to come here; on the other hand, we've seen a generally significant lift in lease rates on renewals, which has put pressure on tenants and the landlord-tenant relationship."

This situation, he says, may level out, "but it's definitely forcing stakeholders to plan ahead."

The multi-residential market is consistent with other asset classes.

"We're seeing growth, we're seeing lots of new inventory - in fact, residential development helped lift the City of Regina to record-breaking building permits in both dollar value and the number of transactions in 2012. But the reality is, there just doesn't seem to be an end in sight to the tight market conditions," notes Avison Young sales associate Art Ingleby.

He says highrise condominium towers under construction, plus distributed clusters of apartment and condo buildings, have been a welcome sight in the city. "However, there has to be land developed to support future construction. And then hopefully there will be a balance of price points to enable all consumer groups to acquire properties," he says.

Founded in 1978, Avison Young is Canada's largest independently-owned commercial real estate services company. Headquartered in Toronto, Ontario, Avison Young is also the largest Canadian-owned, principal-managed commercial real estate brokerage firm in North America. Comprising more than 1,100 real estate professionals in 43 offices across Canada and the U.S., the full-service commercial real estate company provides value-added, client-centric investment sales, leasing, advisory, management, financing and mortgage placement services to owners and occupiers of office, retail, industrial and multi-residential properties.

For further information, comment or photos:

• Richard Jankowski, Managing Director, Regina, Avison Young: [phone]

• Dale Griesser, Principal, Regina, Avison Young: [phone]

• Jeff Sackville, Sales Associate, Regina, Avison Young: [phone]

• Joe Trudelle, Sales Associate, Regina, Avison Young: [phone]

• Art Ingleby, Sales Associate, Regina, Avison Young: [phone]

• Sherry Quan, National Director of Communications & Media Relations, Avison Young: [phone]; cell: [phone]

www.avisonyoung.com

Avison Young was a winner of Canada's Best Managed Companies program in 2011 and re-qualified in 2012 to maintain its status as a Best Managed company.

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Editors/Real Estate Reporters
• Please click on link to view Avison Young's Regina 2012 Year-in-Review/2013 Market Forecast
http://www.avisonyoung.com/sites/default/files/market-intelligence/2013%20Market%20Report.pdf

SOURCE: Avison Young Commercial Real Estate (BC)

Richard Jankowski
[phone] 
[email protected]