Despite a dramatic swing towards an increasingly virtual economy, there are actually a variety of reasons why Canadian commercial real estate will remain in high demand.
It is true that outsourcing is a trend that continues to attract a lot of attention, new technology has made doing business across borders using remote workers easier, new cloud base software continues to be developed, and Internet shopping keeps on growing. However, this does not mean that there won’t be a need for office buildings and retail shopping centers.
It is important to recognize that while outsourcing is a hot trend for now, especially amongst start ups, there will no doubt be a good number of businesses who realize that it just is not viable for the level of quality that they need to maintain to remain competitive. On the other hand, those new companies who do become incredibly successful will likely grow into needing brick and mortar space. Both scenarios will increase the demand for commercial real estate in Canada.
From a consumer’s point of view, while online shopping may be convenient, it just is not as satisfying and enjoyable as walking through a physical store and walking out with bags of new items. Plus, retailers have a lot to gain from live walk in traffic in terms of up-selling.
Big businesses in all fields are also increasingly buying up commercial real estate, for their own use to maintain affordable overhead, tax benefits, bragging rights, the free press, as well as a form of investment for themselves. We have seen plans for the Apple “Mothership” campus and Google’s record $1.9 billion purchases, in the US but Canada is also equally benefiting from this as Canadian energy companies expand and more international headquarters are established within the country.
Beyond the demand for commercial real estate in Canada by consumers and businesses, investors will continue to pursue commercial properties to keep their money working for them, to realize high returns with great security, and to shelter capital/enjoy tax benefits.
The World Wide Web may seem to present boundless opportunities for entrepreneurs, businesses and investors, however it is the limited amount of land and property that we have which will continue to boost its value. There is only so much land, and certainly only so much prime property to be had, even in a country as expansive as Canada.
Commercial real estate in Canada’s western provinces is only expected to grow in value. If we should see minor fluctuations in commercial property values in the next couple of decades, the long term trend is always up. You also have regular income and rents coming in even if equity isn’t growing as fast as you would like.
Want to learn more about how you can profit from commercial real estate in Canada or get more information on some of the great opportunities that are available? Contact Howard today by phone at 866-986-8673 or email him right now at howardm@redevgroup.ca.
Thank you for reading.
Richard Crenian
www.redevgroup.com
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