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of Capital Interest
Produced by Juteau Johnson Comba Inc.
Real Estate Advisors and Appraisers
2255 St. Laurent Boulevard, Suite 340
Ottawa, Ontario
K1G 4K3
Phone 613-738-2426 ex 104
Fax 613-738-0429
Editor John Comba
Winter has come early to the nation’s capital to the delight of my two
daughters (they don’t have to shovel the driveway). Hopefully, the cold
weather we have had so far will continue and allow the canal to open early this
year for skating. It is hard to believe that we are only one month away
from the end of another year. Next week Ron and I will be in Toronto at
the Real Estate Forum and look forward to seeing many of you there. The
forum provides some excellent national and international overviews of trends in
our industry and allows us to visit with a number of our clients.
Now onto the summary of sales for the period August 31st to October
11th. During this time frame there were some 28 sales with a
total value of more than $51,000,000. Retail sales accounted for
40% of the total, office 28%, apartment buildings 7%, industrial buildings 13%,
vacant land 11% and one institution sale accounted for 1% of the total
value.
Sales data provided by RealTrack, Inc. For more information visit http://www.realtrack.com or call
1-877-962-9033
SALES
The retail market picked up this month in comparison to the previous
month, with six transactions totaling $20,656,000. However, five of the
six transactions were between $535,000 and $1,056,000. The total
transactions ranged from $86 to $203 per square foot of building area. One sale
of interest involved the sale of the Hazeldean Mall located at 300 Eagleson
Road in Kanata. The property is comprised of a one-storey retail plaza with
35 units and a two-storey retail/office building with 4 units. The mall
anchors include Your Independent Grocer (Loblaws) and Zellers. Vanreal
Properties Limited purchased the property from Sun Life Assurance Company of
Canada for $15,975,000 or $86 per square foot of building area. The
property had been listed for sale by DS Marcil.
There were seven office building sales during the reported period.
The total consideration for the month of July of over $158,000,000 for the same
number of sales did not hold steady for this past month, as the total value was
a mere $14,411,000 . The sales ranged from $53 to $141 per square
foot. There were three transactions over $2,000,000. The first sale
to occur involved the property located at 1810 St. Laurent Boulevard.
Cablevision Converters Inc. sold the property to Rogers Cable Inc. for
$3,700,000 or $112 per square foot of building area. The site is improved
with two buildings. The front building is a one and two-storey building
with industrial and office space. The rear building is a two-storey
building with office and storage space.
Penwel (2) Holdings Limited sold the property located at 1355 - 1365 Richmond
Road. G.F.I. Properties purchased the two buildings for a total
consideration of $3,698,000 or $90 per square foot of building area. 1355
Richmond Road represents a single-storey retail space leased to Jack Feeney’s
Bar and Grill and a vacant bay, formerly leased by Canada Post. 1365
Richmond Road is a fully leased three-storey, mixed-use building with ground
floor retail and office space above. The listing agent on this property
was Roger Cassagrande of jj Barnicke.
Pyxis Real Estate Equities Inc. sold the property at 150 - 160 Laurier Avenue
West to Toth Equity Limited for $2,740,000 or $141 per square foot building
area. The property is improved with a five-storey office building.
The majority of the building is leased to AT&T. John Seymour of
Colliers International had this property listed for sale.
The apartment market has seen a steady decrease in the number of
transactions since the month of July. Only four transactions occurred
this period with the sales volume totaling only $3,659,000. The sale
price per unit ranged from $53,333 to $136,250. The only large transaction
involved the property located at 660 St. Patrick Street. Montfort
Renaissance Inc. purchased the property from 1374937 Ontario Inc. The
older three and one-half storey apartment building comprising a total of 26
units sold for $1,690,000 or $65,000 per unit. District Realty was the
listing firm for this transaction.
The industrial market continues to be slow with four sales totaling
$6,817,000. The price per square foot ranged from $48 to $102 per square
foot. Alarmbridge Security Network Inc. sold the property at 1155 Lola
Street to Lola Street Property Limited for a total consideration of $3,200,000
or $75 per square foot of building area. The property comprises a
single-storey, multi-tenant office/industrial building. This
property was listed for sale by Jim Shotton and Ian Shackell of CB Richard
Ellis.
Le Conseil Scolaire De District Catholique Du Centre-Est De LOntario sold the school
located at 2360 Virginia Drive in Alta Vista. Formerly known as Cardinal
Leger Elementary School. Uniform Urban Developments Ltd. purchased the
property for a total consideration of $675,000. They are planning on
redeveloping the property with single family housing.
There were seven vacant land transactions during this reporting period
totaling $5,566,153. Three residential land transactions ranged from
$675,000 to $2,100,000. The most significant of the land sales involved
the purchase of several separate parcels of land in the vicinity of Ninth Line
Road and Yorks Corners in the former Osgoode municipality. A total
consideration of $2,100,000 was paid to 480254 Ontario Inc. from 1534058
Ontario Inc. for some 1,060 acres.
One commercial land transaction occurred this month involving the property
located at 400 Eagleson Road. A portion of land located on the west
side of the existing commercial property was sold to the new owners of the
abutting Hazeldean Mall for the purpose of expanding the existing retail
plaza. Vanreal Properties Limited purchased the property from Jim Frisby
Holdings Limited for $197,500 or $25 per square foot.
Three industrial land sales occurred this reporting period. JDS Uniphase
Inc. sold a parcel of excess land on West Hunt Club Road. Kau &
Associates Limited Partnership purchased the land for $1,039,782 or $320,921
per acre. The land is adjacent to the former JDS Uniphase building and it
was purchased by the owner of the adjoining Mobilia Furniture property.
NEWS
CMHC recently released their fall 2002 survey results which places Ottawa's
overall vacancy rate at 1.9%, up from 0.8% last year. The increase in
vacancy is due in part to the significant increase in rents witnessed in the
Ottawa market over the past three years which has resulted in tenants moving
away from higher-priced units in Ottawa to lower priced units across the Ottawa
River in the new City of Gatineau. In fact, Gatineau’s vacancy is
reported at only 0.5%. In addition, historically low mortgage rates have led
potential renters to purchase resulting in a booming local housing construction
market. Lastly, there has been a number of new rental and condominimum
apartment buildings constructed over the past three years. A 175-unit
rental apartment complex was completed by Claridge on Montreal Road, and
Homestead completed (2002) 120 units in Kanata, with a further 120 units under
construction. Currently, some 120 rental units are nearing completion in
the ByWard Market and 156 units are under construction in Sandy Hill (i.e.
Nicholas and Waller). Numerous other potential projects are in the
planning stages. Ottawa is also experiencing a strong resurgence with respect
to new condominium apartment construction. This indirectly increases the
rental supply as in some cases investors purchase condominiums for rental
purposes. For the first eight months of 2002, CMHC reports that
construction was started on 493 condo apartments, up 112.5% over the first
eight months of 2001. Projections for the next three to four years call
for annual starts of 350 to 650 units.
For the fifth consecutive month there were 1,900 job gains in the national
capital region which pushed employment up to 585,8000, a level not seen since
before the collapse of the technology sector in February of 2001.
However, the unemployment rate edged upwards to 7.2% for October from 6.9% in
September. The increase in the employment rate was because 3,600
additional people actively began looking for work. According to
Statistics Canada, job creation has almost exclusively government driven as the
federal public service continues to expand. In the past year, 13,000 of
the 17,400 jobs that have been created have been in the government
sector. The construction industry has also been some 4,000 jobs over the
year due to the hot housing market.
According to the Ottawa Real Estate Board, the resale market in October had
some 928 transactions, which was 2.8% less than the activity in October
2001. For the first ten months of the year there have been a total of
11,478 transactions, which is 9.0% more than for the same period last
year. The average price of a resale home was $200,840 which is up some
16.2% from the same period last year.
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