ICE District

Calgary and Edmonton show strong real estate performance in differing sectors

Friday, June 22, 2018

Alberta’s two largest cities enjoyed considerable real estate investment in 2017 in differing sectors.

While Edmonton saw strong investment in the retail and office sectors, Calgary saw declines in this area, with the latter receiving interest from investors in residential land.

Newly released reports from the Altus Group revealed a detailed breakdown of investor activity in the two markets.

Calgary:

  • Total investment property sales volumes in the Calgary Market Area increased to $3.4 billion in 2017, the highest annual volume since 2013.
  • Declines in the investment sales volumes in the Office, Retail and Land sectors in 2017 were more than offset by stronger sales activity in the remaining sector.
  • The Residential Land market posted the largest absolute volume year-over-year increase – more than doubling to $561 million. This pushed the total value of land sales over the $1 billion threshold for the first time since 2014.
  • The Apartment sector saw a notable improvement in 2017, increasing by 17% on the back of a particularly strong fourth quarter.
  • The Office sector suffered the largest dollar drop 2017, falling by $230 million.

Edmonton:

  • Total investment volumes in the Edmonton Market Area increased to $2.89 billion in 2017, the second consecutive year-over-year increase.
  • The Retail sector accounted for the largest share of investment, with 136 transactions contributing $586 million toward overall investment volumes
  • The Office sector posted the largest absolute increase in dollar volume year-over-year, almost tripling to $425 million.
  • The total value of Land sales was relatively flat from 2016 to 2017. An increase for the ICI Land sector (up by $55 million) was offset by lower sales of Residential Land (down by $38 million).
  • The Industrial sector saw the largest decrease in 2017, falling by 14%, however it was still the second most significant contributor to overall property sales volumes (after the Retail sector).

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