Selling Vancouver Commercial Real Estate

Selling Vancouver Commercial Real Estate

Time to sell your industrial, commercial, or investment property?

In recent weeks, the financial markets have experienced dramatic volatility, as risk is being re-priced at levels not seen in recent memory. The main cause of this roller coaster ride has been that financial institutions have tightened their credit and lending policies, and have thus significantly constrained the ease in which a borrower can obtain financing. This has clearly had an impact on valuation. In light of these conditions, the focus has not been exclusively on pricing, but also on a Purchaser s ability and reputation to close. All combined, this is the perfect storm to negatively impact economic growth. In fact, the financial pundits have already begun to speak widely about the imminent arrival of a US recession, and a bear market.

There is now much less mortgage money available. Buyers will need to be very focused to get a reasonable level of debt to close purchases. While there is still a reasonable appetite for industrial, office, retail and apartment product types, Lenders have no pressure to do business, and want higher pricing if they do participate.

Banks and Mortgage companies are much more conservative than they were six months, or one year ago. If supported by cash flow LTV is now in the 60-70% range max. Loans over $10 million are more difficult as lenders are trying to limit individual deal exposure. This is a market where Purchasers need to be proactive. Purchasers should know up-front, what financing that s available.

The residential market has dramatically cooled over the same period last year. Volumes are off by nearly 50%, causing the market to begin to move from a Seller s Market to a Buyer s Market . This may prove to be a key indicator that suggests it is time to take your gain, and re-invest. Give us a call and we can talk further about the market, and opportunities concerning your real estate portfolio. Alternatively, drop us a quick email using the form below and we will contact you.

Ken England

Associate Vice President

Ken.England@colliers.com

604.662.2645

David England

Investment Division

David.England@Colliers.com

604.662.2651