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UPDATE: Real estate investing, Part 3: REITs worth a look – Western Investor

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Geographically and historically, British Columbia represents perhaps the best opportunity on the planet to make money in commercial real estate. Mortgage rates are at 100-year lows, the housing market is roaring, B.C.’s retail spending leads the country, and the industrial sector is the strongest in Canada by nearly any metric.

The daunting price of B.C. real estate, however, convinces many smaller investors that they are locked out of the market forever.

But, as our series on real estate investing explains, even nascent, non-accredited investors can secure a profitable piece of the real estate action through pooled investments. Consider it the slow and steady route to owning property of your own.

In this third of our four-part Western Investor series, we look at diversifying and profiting in the market through real estate investment trusts (REITs).

A year ago as COVID-19 slammed into Canada’s property market, the benchmark Canadian REIT index (S&P/ TSX Capped REIT Index) immediately plunged 46 per cent from its February 2020 highs, wiping out almost half the index’s value within weeks.

However, as of March 30, 2021, the index had recovered 27 per cent of its value, posting the highest level in the past 12 months. Some analysts forecast that, overall, Canadian REITs will deliver returns of 10 to 12 per cent in 2021.

Others,including Western Investor, expect that returns of 15 per cent to 20 per cent are possible for REITs weighted toward multi-family rental properties, the industrial sector and, perhaps surprisingly, retail assets.

The following are some REIT recommendations.

In the multi-family sector, Canadian Apartment Properties REIT (CAPREIT) is the largest, with about 60,000 apartments across Canada, 9 per cent of them in B.C., notably in Metro Vancouver and Victoria. CAPREIT has a 97.5 per cent rental occupancy and its normalized funds from operations – NFFO, a key metric – increased 14.7 per cent in 2020 to $389 million. On March 30, 2021, it was trading at $54 per unit, up 35 per cent, year-over-year. It is paying an annual dividend of $1.38 per unit. (For instance a $40,000 investment a year ago would have returned approximately $14,000 in unit value, plus $1,380 in dividend payments.)

A multi-family REIT option is InterRent REIT, which, this January in a joint venture with Crestpoint Real Estate Investments, acquired a prime 15 rental-property portfolio in Vancouver for $292.5 million.

Last year set a record for industrial asset sales volume in B.C. with $1.5 billion in transactions, and the market is characterized by a very tight 1.2 per cent vacancy, rising lease rates and ascending sale prices. Most B.C. industrial assets, however, are privately owned and traded.

Choice Properties REIT owns three industrial properties in Metro Vancouver; Artis REIT has a share of two industrial sites; and H&R REIT holds 10 industrial properties in B.C., including four in Metro Vancouver and one in Victoria. H&R REIT has seen its unit value nearly double since March of 2020 and was trading at $14.26 per unit on March 31, 2021. 

Dream Industrial REIT holds premier industrial assets in Canada, particularly on the Prairies, and in the U.S. and it has benefited from the rise in ecommerce warehouse and distribution demand. The company is valued at $2.3 billion, units are trading in the $13.40 range and it is paying a 70 cent-per-unit annual dividend.

The retail real estate sector was hammered by the pandemic but there are signs of recovery. B.C., for instance, posted the highest year-over-increase in consumer sales in Canada this year. Choice Properties REIT holds 11 per cent of its 573 retail-property portfolio in B.C. and grocery giant Loblaws is its major tenant. Choice is a diversified REIT with industrial, retail and office properties. It trades in the $14 per unit range and pays an annual dividend of .74 cents per unit.

REITs are considered a fairly secure place to invest in real estate with modest risk, especially in the current low-interest rate environment.

Pick a REIT and a sector you are comfortable with and let its annual growth and dividends help put you onto the path towards owning real estate of your own.

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Hot real estate market sparks warnings to potential buyers as complaints to regulator double

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As home sales in the province continue on a dizzying trajectory, the province’s real estate watchdog and regulator are warning buyers to be wary of what they may be getting into.

The Real Estate Council of B.C. (RECBC) and the Office of the Superintendent of Real Estate said that in the first three months of 2021, they have seen an increase in inquiries and complaints.

Calls to the regulator were up 42 per cent over the previous year, while complaints, such as how offers were made and accepted, were double the number received in the same period in 2020.

“Buying a home is one of life’s biggest financial decisions. There are potential risks at the best of times, but with the added pressure and stress of the current market conditions, those risks are amplified,” Micheal Noseworthy, superintendent of real estate, said in a statement.

 

 

The Real Estate Board of Greater Vancouver says sales in the region have continued at a record-setting pace.

Residential home sales covered by the board totalled 5,708 in March 2021, up 126.1 per cent from March 2020, when the COVID-19 pandemic hit, and up 53.2 per cent from February of this year.

Rural and suburban areas have experienced the biggest spikes.

For the past two weeks, Jay Park has been in the middle of the buying frenzy.

He and his partner are trying to upgrade from their one-bedroom apartment to a two-bedroom condo or townhouse in Vancouver.

“I wish we had done this a month or two ago,” he said.

 

A condo tower under construction is pictured in downtown Vancouver in February 2020. (THE CANADIAN PRESS/Darryl Dyck)

 

Park put an offer on a $1-million condo, $4,000 above asking price.

“To entice the [seller], we put in a subject-free offer, but it wasn’t successful,” he said. “They accepted $110,000 over asking price that was also subject-free.”

The hot market has led to bidding wars. Some would-be buyers have even lined up outside for days to try to get a jump on a property.

Erin Seeley, the CEO of the council, is warning buyers to do their research and be aware of risks before making an offer.

“It’s really important that buyers have engaged with their lender before they’re making offers so they know how to stay within a reasonable budget,” she said.

Seeley said some of the complaints the council has heard from buyers is that they weren’t aware the seller has a right to take an early offer.

“And the seller was really in the driver’s seat about setting the pricing,” she said.

 

Demand continues to outstrip supply for housing in cities like Vancouver. (Rafferty Baker/CBC)

 

Aaron Jasper, a Vancouver realtor, advises clients to avoid cash offers and to include finance clauses even if it may mean they lose a deal.

“There’s a lot of frustration among buyers, feeling pressure to take some risk,” he said.

“You’re better to be delayed perhaps a year getting into the market as opposed to being completely financially ruined.”

Jasper also says realtors are limited in the advice they can give to clients on legal matters, home inspections, potential deficiencies with homes, and financing.

‘Caught up in the craziness’

Other tips from the council include seeking professional advice before making a subject-free offer or proceeding without a home inspection, and speaking to a professional to determine how market conditions may be affecting prices.

Meantime, people like Jay Park say they are still keen to buy. Park has more viewings scheduled and is optimistic.

“It’s a very exciting time for us, but I also don’t want to get caught up in the craziness and make a purchase that’s above our means.”

Source: – CBC.ca

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Black Press Media introduces one of Western Canada’s best real estate platforms helping home buyers Find. Love. Live. that new home

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Need an agent who knows the community?

Or, is it time to look for a new place to live, but you don’t know what’s on the market?

Whatever the real estate need is for residents in the communities of British Columbia, Yukon & Alberta, there’s a new way to do that one-stop shopping – by visiting Today’s Home.

The slogan for the site is “Find. Love. Live.”

“We want people to find their dream home, love it, and live in it,” said group publisher Lisa Farquharson.

Building on the success of Black Press Media’s niche digital platforms – Today’s Home brings the same wealth of knowledge and local expertise to the search for a home, be it buying, selling, or even just daydreaming about what changes you can make in the future.

Search hundreds of listings that local real estate agents have available.

The listings cover properties around the region, from a one-bedroom, one-bath condo for $339,900 to million-dollar acreages throughout the province of BC, Yukon, Central Alberta and beyond.

Click on a listing, and see not only the realtor handling the property sale, but links to his or her other listings and social media feeds. With the click of a mouse, take a virtual tour of the property, find the property’s walking score, and learn about nearby amenities.

There are links available to schedule a showing, or send the agent a comment or question.

Want to share a listing? When you click on the share button, you’ll actually send an attractive digital flyer of the prospective property, not just a link.

There’s even a button to help determine how much you have to spend, courtesy of the convenient mortgage calculator.

Plus, scroll down the page on Today’s Home and find a list of expert local real estate professionals who can answer questions or help with that home sale, Farquharson explained.

Today’s Home offers the advantage of the massive reach that Black Press Media has built throughout Western Canada with its network of community newspapers and online products. That allows the public to tailor real estate searches based on location, price, and other key factors while allowing real estate professionals to gain unprecedented audience reach with their listings.

Today’s Home will dovetail into the media company’s existing print real estate publications.

“Black Press Media has real estate solutions in print and now we can add in the digital component,” Farquharson said.

Watch for expansion of the Today’s Home platform in the near future, she added. That will come as Black Press Media adds a new component – the development community. Developers will be able to reach a huge audience when their projects are ready for presentation.

For information on Today’s Home, contact group publisher Lisa Farquharson at 604-994-1020 or via email.

Happy house hunting!

Source: – Aldergrove Star

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PGIM Real Estate, Revera Affiliate Target UK Market in Newly Formed JV

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Real Estate Sales In September

PGIM Real Estate has been active in recent months providing capital to facilitate blockbuster senior housing acquisitions. Now the firm is looking to capitalize on demand for senior housing in the United Kingdom.

The Madison, New Jersey-based real estate investor and lender announced this week it is entering into a joint venture with Signature Senior Lifestyle, an affiliate of Revera, to develop and operate senior housing communities around greater London

Mississauga, Ontario-based Revera serves 20,000 older adults in long-term care homes and retirement residences in Canada. It is also the majority shareholder of Sunrise Senior Living, one of the largest senior housing providers in the U.S. The company operates a portfolio of 12 communities in the U.K. under the Signature Senior Lifestyle brand, with one community in development that is slated to open in autumn 2021.

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The JV has one development underway — a senior housing community, or “prime care” home, in southwest London. PGIM worked with Elevation Partners, a London-based investor and asset manager in U.K. health care real estate, in sourcing, structuring and executing the venture. Additionally, PGIM will retain the firm to leverage its expertise.

PGIM and Revera did not respond to requests for comment from Senior Housing News regarding details about its development pipeline.

London is emerging as a future hotbed of senior housing development, spurred by favorable demographic growth trends and a lack of available supply, and the PGIM-Revera venture will find competition.

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Maplewood Senior Living CEO Gregory Smith told SHN last month that demand for U.K. senior housing is comparable to major U.S. markets such as New York and San Francisco, where supply has historically been constrained.

Maplewood and its investment partner, Omega Healthcare Investors (NYSE: OHI) are looking to expand its luxury Inspir brand to the U.K., and identified five suburban markets around London with high barriers to entry that are favorable for the brand’s growth.

Revera CEO Tom Wellner sees similar untapped upside potential for senior housing in the U.K.

Source: – Senior Housing News

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