Activity in Ottawa’s multi-family residential market continues to heat up along the light-rail transit line, according to a new report from Colliers International.
Some $587 million worth of multi-family property changed hands over the course of 2019, the real estate services firm said in a recent report focused on Ottawa’s apartment, condo and multi-family development markets.
Among last year’s blockbuster transactions, Colliers highlighted major purchases from Starlight Investments, which bought up more than 1,000 units for a total of $236.3 million across three transactions in 2019. The average transaction last year was worth roughly $9.8 million, Colliers said, with costs working out to $228,967 per door.
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Colliers wrote in the report that the push to increase density along Ottawa’s LRT line, combined with steady public sector employment, has driven fervent interest in the city’s multi-family market.
Ottawa’s builders are also keen to take advantage of the swelling interest in the sector. Colliers reported there are currently 4,900 multi-family units under construction with 10,300 more planned. Of the planned new supply, 78 per cent is slated for rental use.
Meanwhile, vacancies in the multi-family market remain tight. The vacancy rate for bachelor units sat at 1.3 per cent in the fourth quarter of 2019, down from 1.6 per cent the year before. Available two-bedroom suites are also getting snapped up quickly with that segment of the market posting a vacancy rate of 1.8 per cent, down from 2.1 per cent in 2018. The vacancy rate for one-bedroom units, meanwhile, loosened slightly, increasing to 1.5 per cent from 1.4 per cent a year ago.
Renters are paying more for those one-bed suites, however, as average rental rates sat just under $1,600 in Q4 2019, up 7.4 per cent year-over-year. The average rent for two-bedroom units was steady around $2,000 at the end of 2019.
