Shortage of Inventory Affecting Commercial Spaces in GTA Too
We all know by now that there’s a shortage of particular types of inventory in the GTA right now. Even as condos are dotting more of the Toronto sky every day, the amount of single-detached homes continue to dwindle. And that’s left the buyers with the most amount of money available for a home left short, scrounging for properties that simply aren’t there. But while most of the attention has been on these properties, there’s another type that’s also not short on buyers – but short of lots that are available. And those are commercial properties.
And it’s not just things like office buildings and retail storefronts that investors and business owners are having a hard time finding. It’s also things like apartment buildings and industrial buildings. And it may not just be the GTA. The ReMax Commercial Report says that this is happening in many Canadian cities.
“There’s a lot of money chasing a limited supply of commercial product,” says Gurinder Sandhu, executive vice president of ReMax.
And, he says, just because those properties aren’t on the market doesn’t mean that buyers are ready to quit. He’s been seeing situations in which buyers are entering into bidding wars on properties that aren’t even there.
“In some areas of the country, we’re seeing unsolicited offers on product not available for sale – often well above market value,” he says.
But it’s a case of the numbers not always giving the full story. In fact, in the beginning of this year real estate income trusts and pension funds were actually down by 73 per cent in 11 of Canada’s major markets. But, the ReMax report shows that this is because the properties simply weren’t there – not because there was too little interest in them. The report actually calls the demand for apartment buildings “unprecedented,” and shows that those properties along the subway and with other access to public transportation “remains unabated.”
Unfortunately, what the ReMax report doesn’t say is when the numbers of commercial properties will begin to increase, or when the sales numbers will begin to show once again what’s really happening.