Foreign investors looking for global real estate investments
have ranked Canada among the top three countries to park their money.
The
U.S. and Germany were in first and second place, but Canada ranked
third in the survey for providing the most "stable and secure"
investment by the Association of Foreign Investors in Real Estate
(AFIRE) released Monday.
Last year Canada placed sixth.
Canada also ranked sixth as the country best seen as providing the most
opportunity for capital appreciation. Last year Canada ranked 13th.
"Canada
is a core investment for many investors who see our market for its
stability," said George Carras, president of commercial real estate
consultancy RealNet Canada Inc. "This bodes well for the future, where
we might see more interest from foreign investors this year."
Despite
the promising signs, 2009 was a dismal year for commercial real estate,
particularly in the key Greater Toronto Area market.
There was $5.4 billion worth of investment volume in commercial buildings last year, the lowest figure in more than a decade.
"It was definitely a tough year, where a lot of investors just sat on their hands waiting out the market," said Carras.
The
market started to show signs of life in the fourth quarter, however,
with an almost four-fold increase from the third quarter.
The
biggest sale in the fourth quarter and for the year was 151 Front St.
E. for $180 million to Allied REIT. Morguard Investments also purchased
two office towers on Bloor St. for $164 million.
The
international perception that Canada has withstood the economic
downturn particularly well has been beneficial for the real estate
markets here.
The perennial frontrunner, the United States,
while still in No. 1 spot as being a stable market for investment at 44
per cent of the vote, is down from 53 per cent in 2008 and 57 per cent
in 2010.
This is the first time that the United States, a
place where investors have traditionally parked their money, has fallen
below 50 per cent. Germany received 21 per cent of the vote and Canada
was at 14 per cent.
The industry group predicts that 2010 will be a better time for the investment industry.
"Although
foreign investors expressed every intent to resume investing in 2009,
like everyone else their plans were sidelined by a paralyzed
marketplace with no precedent and limited investment opportunities,"
said Werner Sohier, chair of AFIRE.
"However new money is becoming available and the survey points to an increased focus and interest in a few select markets."
