A Tale of Two Countries: Canada vs US Commercial Real Estate

Yes, our Dickens inspired headline is truly cringe-worthy1. But it really does set up this week’s article quite nicely. That’s because in the US, pundits are tossing around terms such as “Retail Apocalypse” and “Dead Malls” in reference to the impact that e-commerce has had on bricks-and-mortar retailers. CNN and Business Insider have articles devoted[…]

2 Kids (Corporate Giants) Battle for the Sandbox (Edmonton Market Share)

Much has been made about Amazon’s recent announcement to build a 1M square foot fulfillment centre in Nisku. The story was covered extensively in the news, and Premier Rachel Notley publicly gushed that the facility will lead to hundreds of jobs (despite Alberta losing 15,500 jobs over Christmas). While it’s undeniably good news for the[…]

Ups and Downs: Q1 Commercial Real Estate Update

We’ve already covered some interesting territory this year. We went on a two-week bender about real estate investment analysis, only to cap it off (terrible pun) with a rant on the City of Edmonton’s draconian zoning bylaws. This week we’re getting back to the basics and providing a commentary on the market as a whole. Our[…]

You Can’t Fight City Hall – Especially in Edmonton

Steve1 leases a 300,000 square foot distribution facility in Northwest Edmonton.  The building consists of predominantly warehouse space, but it also includes an office area.  At one point, the office area was full with tech support, sales people and administration staff.  Unfortunately, recent company layoffs had reduced the amount of office the company required.  To[…]

Internal Rates of Return for Commercial Real Estate

Building on our article from last week, we’re going to focus this week on a commonly used term in finance called the Internal Rate of Return (IRR). Before we get into IRR, we first need to give a quick refresher on capitalization (cap) rates. The formula can be expressed graphically as follows: Where: I =[…]

A $695,000 Real Estate Mistake and How To Avoid One Yourself

Imagine, for a moment, that you just negotiated terms to purchase a property for $5,560,000. Presumably, you would do some basic homework on the property.  Perhaps it was a simple inspection, or maybe a more sophisticated engineering report. You may have even hired an appraiser. But after concluding it was the right property, you certainly wouldn’t be happy[…]

Oil Prices Have Increased 300% in the Past Two Months

Canadian oil prices had a rough 2018. Not only did the spread between West Texas Intermediate (WTI) and Western Canadian Select (WCS) hit a record of over $50 USD / barrel, prices of WCS bottomed out near $10 / USD in November. Reflecting back on last year, our mood on the market seemed to move[…]

2019: Edmonton Storm Clouds or Silver Linings?

We’re only in the first week of 2019 and we’re already prepared to make our first prediction of the year. With the caveat that we have made some remarkably poor predictions in the past, we’re fairly certain we’ll get this one right: 2019 will be filled with a lot of negative headlines. We’re basing this[…]