Lenders both domestic and foreign signalled a growing interest in Ottawa’s commercial real estate market heading into the new decade, according to a survey from real estate firm CBRE.
Respondents to CBRE’s latest Canadian Real Estate Lenders’ Report survey expressed a strong desire to support transactions in Ottawa, ranking the capital No. 2 nationwide.
Some 52 per cent of lenders surveyed indicated “strong” interest in supporting deals in the capital, edging out Vancouver at 50 per cent. Ottawa displaced Vancouver from the previous year’s rankings but remained behind Toronto, which held on to the top spot with 78 per cent of lenders indicating “strong” interest in the market there.
Roughly 17 per cent of lenders indicated “moderate” interest in Ottawa, while 13 per cent of respondents indicated their interest in the local commercial real estate sector would be deal- or relationship-specific.
In terms of asset classes, 39 per cent of those surveyed said they intend to increase budget allocations towards industrial properties, as opposed to 22 per cent who said they’d look to increase lending on office deals. On the residential side, another 39 per cent said they’d be lending more on mutli-family rental properties, with only single-digit interest in additional allocation to condo and single-family classes.
Nearly 72 per cent of lenders surveyed said they did not expect a recession to hit in 2020, though 45 per cent indicated the risk of an economic downturn is likely to have a strong influence over lending decisions in the year ahead.