WINNIPEG, MB, Nov. 30, 2020 /CNW/ – Artis Real Estate Investment Trust (“Artis” or the “REIT”) (TSX: AX.UN) announced today that it has reached an agreement with Sandpiper Group (“Sandpiper”) to withdraw its unitholder meeting request and pending litigation. Under the terms of the agreement, four existing trustees, Armin Martens, Edward Warkentin, Wayne Townsend and Bruce Jack, have tendered their resignations from the Board of Artis effective immediately. Sandpiper’s five nominated trustees: Heather-Anne Irwin, Samir Manji, Mike Shaikh, Aida Tammer and Lis Wigmore will be added to the Board. Armin Martens, President & CEO, will be retiring effective December 31, 2020 and Jim Green, CFO, will be retiring effective at the conclusion of the 2021 annual meeting of the unitholders.
Edward Warkentin, Chairman of the Board, said, “We are pleased to have come to an agreement with Sandpiper that Artis believes is in the best interests of the REIT and all of its unitholders. The reconstituted Board will provide continuity as well as adding new Trustees with a broad range of experience and expertise. The Board and management remain committed to ensuring that this transition be effected in an orderly and responsible manner for the benefit of all of Artis’ stakeholders. On behalf of the Board, we would like to thank Armin for his leadership and contributions to Artis over the years. Armin was instrumental in building Artis into the successful REIT that it is today and we sincerely thank him for those efforts and wish him the best on all his future endeavours. We are also pleased that continuity in CEO and CFO positions will be thoughtfully managed by Senior Executives at Artis in collaboration with the Board. On a personal level, I am grateful for the opportunity of having served as the Chair of Artis since its inception. Throughout my tenure, I have had the privilege of serving alongside an exceptional group of talented, professional, insightful and dedicated Trustees and I would like to thank each and every one of them for their contributions over the years.”
Armin Martens, President & CEO, said, “I am pleased that Artis was able to reach an agreement with Sandpiper that Artis believes is in the best interests of the REIT and all of its unitholders. Having served as Artis’ founding Chief Executive Officer for 16 years, I feel this is an appropriate time for leadership renewal and succession. It has been my honour and privilege to serve this great company. I am proud of the people of Artis and the excellent business we have built and wish the new leadership team and all Artis unitholders continued success in the years ahead.”
“We are pleased to reach an agreement with the Board of Artis that we believe will benefit all unitholders,” said Samir Manji, Chief Executive Officer of Sandpiper. “On behalf of all fellow unitholders, I would like to thank Armin, Ed, Wayne, Bruce, and Jim for their many years of service to the REIT and their commitment to a smooth transition moving forward. I look forward, alongside the continuing and newly added trustees, to contributing to the future growth and success of Artis.”
Artis is a diversified Canadian real estate investment trust investing primarily in industrial and office properties in select markets in Canada and the United States. Since 2004, Artis has executed an aggressive but disciplined growth strategy, building a portfolio of commercial properties, comprising approximately 23.8 million square feet of leasable area. Artis is focused on growing its industrial portfolio through strategic development projects in its target markets.
Sandpiper is a Vancouver-based private equity firm focused on investing in real estate through direct property investments and public securities. For more information about Sandpiper, visit www.sandpipergroup.ca.
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this press release.
SOURCE Artis Real Estate Investment Trust
For further information: Artis Contact: Heather Nikkel, Vice-President, Investor Relations, Phone: (204) 947-1250, Email: [email protected]; Sandpiper Contact: Alyssa Barry, Vice President, Capital Markets and Communications, Phone: (604) 558-4885, Email: [email protected], www.sandpipergroup.ca
Albertans more confident in real estate than economy, new poll finds – Calgary Herald
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“Albertans have been in a recession for over five years, so we are used to living in a slower economy where we have seen declining housing prices.”
Accordingly, he suggests many people have been slow to recognize the mounting strength in the housing market with prices slowly gaining upward momentum. In fact, Calgary Real Estate Board figures show over the last few months year-over-year gains for the benchmark price of home.
“Conversely, I see the provinces where there has been high real estate (price) inflation that people still feel prices will increase more,” he says.
The RBC survey reflects this somewhat nationally with 52 per cent of respondents agreeing prices will only go up in the near future. That increases to 60 per cent in British Columbia and 56 per cent in Ontario, but it falls to 37 per cent in Alberta.
Additionally, it found COVID-19 still factors heavily into homeowners’ thinking. While 78 per cent nationally are concerned about its impact on the economy, that increases to 88 per cent in Alberta. Yet the number of respondents concerned the second wave will negatively impact the housing market falls to 43 per cent nationally and 45 per cent in Alberta.
Lowell suggests Albertans’ more favourable view of real estate compared with the overall economy may reflect what he’s seeing in Calgary with many would-be buyers and sellers. He notes many may be sensing home prices “are at or very close to the bottom and to wait much longer in light of today’s (low) mortgage rates could be missing out on a buying opportunity.”
Vancouver real estate shakes off the pandemic fetters – The Globe and Mail
Housing markets in desirable cities have proven impervious to the effects of the pandemic, Vancouver included. Royal LePage released its quarterly house price survey last week that showed the median price of a two-storey detached house in Greater Vancouver had gone up 8.8 per cent by the end of 2020.
That hypothetical two-storey house will now cost you $1,507,279. A bungalow in the region will take you back $1,265,285, and a condo $662,120. The company has forecasted that prices will climb even higher by spring.
Vancouver is not an outlier in Canada – 64 per cent of all regions surveyed showed year-over-year median-price increases of more than 10 per cent for two-storey houses. Others have reported similar numbers.
Since May, multiple offers have been common for sales of detached houses, says Randy Ryalls, the general manager for Royal LePage Sterling Realty in Port Moody. He points to low inventory and anxious millennial buyers for fuelling the market. While many service-industry workers lost their jobs because of the pandemic, the market is strong because it’s the older, higher-income bracket that is driving it. Millennials, in particular, are buying, now that many have reached peak earning potential and have families.
“[The pandemic] has probably persuaded some of those people that are paying $2,500 or $3,000 a month in rent to start thinking about buying something, and so those people have moved into the marketplace in significant numbers.
“The millennial demographic plays a huge role in our real estate market, and they are the biggest group demographically in the real estate market now. They are all at that time in their lives where they are starting to have families and they have better jobs and can afford to buy something, and they are out there doing that,” Mr. Ryalls says.
“Some of them are buying $700,000 or $900,000 homes – or $1-million houses further out.”
Over all, the Vancouver market has gone up around 10 per cent, mostly since May, Mr. Ryalls says. Surrey has gone up around 14 per cent, as purchasers snap up houses. The condo market, which had slowed considerably in the past year, also seems to be gaining traction. Investors are returning to the market.
A three-unit house in Vancouver’s Riley Park recently sold for $202,000 over asking, demonstrating the strong appeal of investor properties. The house at 719-723 E. 29th Ave., had an asking price of $1.599-million and sold for $1.801-million after 12 days on the market. The sale closes Feb. 9. Listing agent Cheryl Davie of Re/Max Crest Realty received ten offers.
The property actually comprises three separate units: a 1,965-square-foot detached character home built in 1908 and fully remodelled, with ground level and upstairs suites, and a two-level laneway house built in 2017 and renting for $2,200 a month.
“The Fraser area of East Vancouver has seen a lot of development over the past decade, and there is the possibility this parcel could be bought and redeveloped in the future,” Ms. Davie said.
Ian Watt, a downtown realtor, says he had an investor buyer put in an offer on a downtown one-bedroom condo recently that went into multiple offers. All offers, he says, came from investors.
“I have a feeling this year will be a crazy year because a lot of people are back out there and looking to buy,” Mr. Watt said.
At the outset of the global health crisis, nobody could have predicted that housing prices would actually go up. Mr. Ryalls from Royal LePage says he had braced for the worst, and the buoyant market has shocked him. At this rate, he doesn’t see the Lower Mainland ever going back to prices considered affordable to the average income earner.
“In March, we were all wondering how much longer we would be in business,” he says. “I can appreciate that it sounds very self-serving from the real estate industry, but if you look back, every 10 years the prices have doubled in the Lower Mainland. That goes back historically for decades. We have a pretty resilient real estate market here.”
It strikes urban designer, professor and author Patrick Condon as noteworthy that the housing market would thrive amid a pandemic. Prof. Condon says the situation underscores the fact that housing prices, and rents, too, remain disconnected from the jobs market.
“Somehow, when people all over the world are losing heir jobs, the value of housing has inflated rather than crashed. So how do you explain that?”
Prof. Condon just released a book, Sick City, in which he does just that. While Sick City focuses on the U.S. housing situation, and growing inequality in that country, there are many parallels with what’s happening in Canada, says Prof. Condon, who’s from Massachusetts.
The beneficiaries of rising land prices fall into two categories, he says. There are the older homeowners who have been lucky enough to buy into the market before the outrageous inflation, and whose equity has grown significantly; they have the advantage of borrowing against that equity or adding significant value to their properties by building infill. And then there are the speculators, who have driven prices up on their way to reaping capital gains. The smart ones purchase land near new transit or some new improvement. That behaviour has pushed up prices not just for homeowners, but for renters, too.
Going back to the 1990s, Prof. Condon says that urban land became a class of assets that went beyond the rate of inflation in desirable cities such as Vancouver, Sydney, London, New York and Singapore. When properties became an asset for global wealth and speculation, they became disconnected from incomes. That decoupling lead to the lack of affordable housing we see today.
“It had nothing to do at all with the wages of people who are basically competing for that, and it influences not just housing costs, but also the cost of rent, as the value of the land under the rental buildings gets bid up and up and up.”
Land has always made a sound investment; however, in the new environment, the returns are higher than ever.
“If you are going to invest, you’re smartest to invest in urban land in this host of cities and you don’t care how much it will cost – because you know it will go up for sure, 8 to 12 per cent.”
Prof. Condon also disagrees with prevailing policies that call for more supply as the answer to the affordability crisis, as if we can build our way to healthy, thriving cities where residents are properly housed and no one is displaced. Instead of lowering housing costs, rezoning for more density only increases the price of the land. Price is based on the buildable square feet that zoning allows.
“In the long run, it prevents access to affordable housing for the average wage earner, because it all ends up being absorbed in the price of urban land.”
That’s why he’s long argued for taxing new developments, along the Broadway Corridor, for example. It’s a cost that would have to be included in the purchase price of the land, thereby lowering land costs. He cites parallels to the Vienna model. Decades ago, the Austrian capital’s rent controls and taxation on land reduced land prices, which gave the city a chance to develop much of the rental stock. Today, Vienna has a considerable amount of publicly owned housing and co-ops.
“It’s the land market that needs to be disciplined. It’s not the developers that are the problem – it’s the land speculators,” Prof. Condon says. “Tax at the full value of that increased land value, and take the lion’s share of that money and use it to build non-market housing that would be permanently affordable.”
Sick City by author Patrick Condon is freely distributed on a creative commons license. It can be downloaded here.
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