2022 CANADIAN ECONOMIC OUTLOOK - AND MARKET FUNDAMENTALS FIRST QUARTER UPDATE 24TH ANNUAL EDITION - Morguard
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2022 CANADIAN ECONOMIC OUTLOOK
MORGUARD
AND MARKET FUNDAMENTALS FIRST QUARTER UPDATE
24TH ANNUAL EDITION
Q1
MORGUARD CONTENTS Q1 FINANCIAL REPORT / 2 INVESTMENT REPORT / 4 LEASING REPORT / 6 ECONOMIC REPORT / 8 INVESTMENT MARKET TRANSACTIONS / 10 ABOUT MORGUARD / ACKNOWLEDGEMENTS / RESOURCES / 11 2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 1 / NEXT
Q1 U P DAT E
MORGUARD
FINANCIAL REPORT
POLICY TIGHTENING COMMENCED
The Bank of Canada (BofC) began to reduce its emergency-
level policy support during the first quarter, a move that the
broader capital and futures markets had been anticipating for
several months. The BofC raised the overnight rate to 0.5% on
March 2nd while maintaining its Government of Canada (GofC)
bond holdings on its balance sheet.
OFFICIAL POLICYRATES
OFFICIAL POLICY RATES
International Monetary
International Conditions
Monetary Conditions
6%
Hundreds
5%
4%
3%
2%
1%
0%
-1%
04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21
US Federal F unds Rate Cdn Overnight Lending Rate
Bank of Japan Policy Rate European Central Bank Target Rate
Source: Bank Of Canada, Federal Reserve Board, European Central Bank, Bank of Japan
The Bank’s Governing Council indicated additional interest fourth quarter growth. The national economy expanded by
rate increases were likely forthcoming over the balance of a robust 6.7% on an annualized basis in the final quarter of
2022, against a backdrop of continued economic expansion 2021. The second factor was the persistence of elevated
and elevated inflation pressure. In addition, the Council inflation pressure, which was expected to last longer than
expected to look at an eventual wind down of GofC bond initially forecast. Over the next several months, the BofC is
holdings over roughly the same time period. The BofC’s expected to continue to raise interest rates. However, the
decision to raise the overnight policy rate was driven by rate of increase is somewhat uncertain, given the potentially
two main factors. The first was the absorption of Canada’s negative impacts of Russia’s invasion of Ukraine and inflation
economic slack, driven in large part by stronger-than-expected on global trade and economic growth.
2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 2 / NEXT
FINANCIAL REPORT Q1 U P DAT E
MORGUARD
CONSUMER PRICE GROWTH ACCELERATED NATIONALINFLATION
NATIONAL INFLATION
CPI Measures, % Change
Change Over
Over 11 Year
Year Ago
Ago
Consumer price growth accelerated in the first quarter of
2022, reaching a 30-year high level. The price of goods and 5%
Hundreds
services in Canada’s Consumer Price Index (CPI) rose 5.7% 4%
3%
year-over-year in February, up sharply from 5.1% average
2%
of the previous month. Energy and food prices continued to
1%
climb at a robust rate in the first quarter. Energy price growth
0%
of 24.1% was recorded year-over-year in February, up 100 bps -1%
from the previous month. Consumers continued to face rising -2%
04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21
food costs, with the rate of year-over-year inflation rising to
Co re CPI (C PIX) Total CPI Inflatio n Con tro l Ta rget
7.4% from 6.5% in January, which was the highest rate in over
a decade. The home and automotive sectors were also big Source: Bank Of Canada, Statistics
price inflation drivers during the first quarter. Consumer price
growth accelerated in most other CPI spending categories.
Price inflation rose to 3.9% year-over-year for all spending GLOBAL
GLOBAL INDICES
INDICES
Trending of Global Price
Trending Price Return
Return Indices
Indices
categories combined in February, excluding energy and
food. The average was up 50 bps from January. Clothing 80 0
and footwear were the only two spending categories with Index (1994:4 = 100) 60 0
slight declines in pricing reported year-over-year in February.
40 0
Consumer price inflation is expected to continue to accelerate
over the near term, led by the commodities sector. The war 20 0
in Ukraine will continue to drive commodity prices higher. 0
Jun -04
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Consumer demand will add to the upward pricing pressure
over the balance of the year. More broadly, inflation will Euro D .J. Sto xx 5 0 France C AC 40
outdistance income and wage growth, in keeping with the German D AX UK: FT SE 100
Source: RBC Capital Markets
accelerated price inflation of the first quarter.
EQUITY MARKET VOLATILITY INCREASED
Global equity market volatility increased substantially during MORTGAGE
MORTGAGE SPREADS
SPREADS
Commercial Mortgage
Commercial Mortgage Rates Vs. 5-Year GOC Bonds
Bonds
the first quarter, following a largely positive performance
pattern over the past year. Several factors contributed to 16 %
Hundreds
increased volatility, the most prominent of which was the war 12 %
in Ukraine. The various sanctions placed on Russia by North
8%
American Treaty Organization (NATO) and European Union
(EU) negatively impacted economic activity and trade in the 4%
region. The potential for the negative economic impacts of the
0%
conflict to spread to the rest of Europe and the world eroded
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investor confidence. In turn, some investors assumed an
equity market risk-off position. Another significant driver of 5-Ye ar Comme rcial Mo rtgage R ate 5-Ye ar Go C Bond Yi eld
Source: RBC Capital Markets, Bank of Canada
the first-quarter equity market volatility was the U.S. Federal
Reserve’s (Fed) 25-bps hike of its benchmark interest rate
and indication that further increases were likely in the coming
months to reduce 30-year high inflation. The rate at which the Canada’s Consumer Price Index
Fed raises rates over the next several months will reverberate
through the world’s largest economy and global equity rose sharply during the first
markets. The combination of the crisis in Ukraine, near record-
high inflation, and the emerging sixth wave of the pandemic
quarter, with 5.7% year-over-year
will likely continue to drive equity market volatility over the next growth in February.
few months.
2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 3 / NEXT
Q1 U P DAT E
MORGUARD
INVESTMENT REPORT
SALES ACTIVITY HELD AT PEAK LEVEL
Canadian investment property sales activity continued at a peak
level during the first quarter, driven in large part by the industrial
and multi-suite residential rental sectors. Just shy of $3.4 billion
of investment transaction volume was reported for the industrial,
office, multi-suite residential, office, and retail property sectors
as of the start of the final week of the quarter for the Vancouver,
Calgary, Toronto, Ottawa, and Montreal metros combined.
YIELD SPREADS
Cap Rates vs. 10-Year GOC Bonds
10%
Hundreds
8%
6%
4%
2%
0%
Mar-01
Mar-02
Mar-03
Mar-04
Mar-05
Mar-06
Mar-07
Mar-08
Mar-09
Mar-10
Mar-11
Mar-12
Mar-13
Mar-14
Mar-15
Mar-16
Mar-17
Mar-18
Mar-19
Mar-20
Mar-21
Mar-22
Sep-00
Sep-01
Sep-02
Sep-03
Sep-04
Sep-05
Sep-06
Sep-07
Sep-08
Sep-09
Sep-10
Sep-11
Sep-12
Sep-13
Sep-14
Sep-15
Sep-16
Sep-17
Sep-18
Sep-19
Sep-20
Sep-21
GO C 10-Y ear Yield Offi ce-CBD Retail-Region al
Industr ial-Multi Tena nt Apa rtment-Su burban
Source: AltusInSite, Bank of Canada
Industrial remained the most active of the four main year high for the period. Investors have exhibited a propensity
investment property sectors to start the year. Approximately for acquiring properties with solid long-term performances
$2.9 billion of industrial property was sold, matching the in established nodes. Multi-suite residential rental sector
decade-high pace of a year ago. A broad range of investment investment sales activity surpassed the long-term average
groups continued to focus on the sector, given stellar by a wide margin in the first quarter. Just over $2.0 billion in
leasing fundamentals and forecast rent growth. Office sector transaction volume was tallied, with one week to go in the
transaction volume increased significantly during the first few quarter. In contrast, retail sector activity levels remained
months of 2022, having trended markedly lower over the past relatively muted, with a modest $1.2 billion in sales posted.
year. Transaction volume totaled $2.2 billion with one week to Investment property sales activity is expected to continue to
go in the first quarter. The total was close to double the figure range at or near a record-high level over the balance of 2022,
reported for the first quarter of 2021 and represented a four- in keeping with the recent trend.
2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 4 / NEXT
INVESTMENT REPORT Q1 U P DAT E
MORGUARD
MONTREAL INDUSTRIAL WAS PRIME RELATIVE PERFORMANCE
TARGET Comparing Annualized Returns To Dec 2021
Montreal’s industrial property sector was a prime target of a 40%
35%
range of investment groups during the first quarter, in keeping 30%
35.1%
17.5%
25%
with the trend of the past few years. Investment sales activity
13.0%
11.0%
20%
10.0%
25.1%
continued at a blistering pace during the first three months
9.1%
8.7%
7.9%
15%
6.9%
6.4%
4.8%
5.3%
4.8%
3.4%
10%
of 2022, resulting in record-high transaction volume. More
0.1%
0.8%
0.9%
0.8%
5%
than $752.1 million of investment property sales had already 0%
-4.5%
-5%
been completed in the quarter with one week remaining. The -10%
1-Year 3-Year 5-Year 10-Year
total for the full three months of the quarter will most certainly
S&P/TSX Index T-Bill FTSE Long Bond TSX REIT Index RCPI/IPD Index
surpass the $754.4 million in sales reported in the first quarter
Source: © MSCI Real Estate; RBC CM; TSX Datalinx; SCM; PC Bond Analytics
2021. Investors looked to the Greater Montreal Area (GMA)
industrial property sector as a source of stable and growing
income and capital appreciation. Generally, demand for GMA
industrial investment opportunities has outdistanced supply MSCI RETURNS
Annualized Returns By Property Ty pe To Dec 2021
by a significant margin over the past couple of years. In some
35%
cases, investors turned to older properties with redevelopment
30%
or repositioning potential to increase their exposure to the
31.6%
25%
market. The demand supply imbalance resulted in continued 20%
15%
19.9%
downward pressure on capitalization rates during the third
16.6%
10%
4.6%
4.3%
12.4%
2.8%
2.8%
2.8%
quarter, which were already at record low levels. At the same
10.2%
9.4%
9.2%
8.9%
5%
7.0%
8.0%
6.2%
6.4%
7.4%
time, investors looked to capitalize on the outsized rent growth 0%
-0.5%
-3.9%
-5%
that had characterized the sector over the past year, which -10%
1-Year 3-Year 5-Year 10-Year 15-Year
was expected to persist over the near term. The forecast
Industrial Office Retail Apartment
rent growth and fundamentally sound outlook will continue to
Source: © MSCI Real Estate 2022
position the GMA’s industrial sector as a prime investor target
over the near term.
INVESTMENT ACTIVITY
INVESTORS EXHIBITED CONFIDENCE IN Total Inv estment Volume
OFFICE SECTOR $80
Investors continued to exhibit confidence in Canada’s office
$62.0
$59.1
$70
sector in the first quarter, despite a measure of uncertainty.
$49.3
$60
$45.2
$43.1
Several significant transactions closed or were scheduled $50
Billions
$35.2
$34.7
$32.1
to close during the three-month period or shortly after. The
$30.6
$40
$26.8
$26.1
$26.1
$24.0
$23.6
$19.9
$21.7
$19.5
$17.3
most prominent of these was the sale of Royal Bank Plaza $30
$13.0
$20
in Toronto for $1.2 billion. Additionally, a couple of significant
$10
portfolio sales were also consummated. Allied Properties
$0
04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22F
Real Estate Investment Trust (REIT) finalized the acquisition
Domestic Foreign Forecast
of a 1.2 million square foot six-property portfolio in Toronto, Source: CBRE Limited; Morguard
Montreal, and Vancouver for $794 million from Choice REIT.
Crown Realty Partners acquired a 1.2 million square foot
portfolio of properties in Mississauga’s Heartland Business Investors continued to exhibit
Community. The confidence investors exhibited in the office
sector during the first few months of 2022 came during a confidence in the Canada office
period of elevated leasing market uncertainty. Much of the
uncertainty is related to the emergence of various work-from-
sector, resulting in several
home programs instituted by some tenants in the aftermath of significant transaction closings
the pandemic.
in the first quarter.
2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 5 / NEXTQ1 U P DAT E
MORGUARD
LEASING REPORT
OFFICE LEASING PERFORMANCE WAS MIXED
Canada’s first-quarter office leasing market performance was
somewhat mixed. There was a significant degree of variation
in absorption patterns across the country. Modest gains were
recorded in the four Western Canadian metros tracked by CBRE.
Conversely, materially negative results were posted in four of the
six eastern Canadian metros tracked, with a slight negative and
positive total for Halifax and London, respectively.
OFFICE DEMAND&&SUPPLY
OFFICE DEMAND SUPPLY
National
NationalHistorical
Historical&&Forecast
ForecastAggregates
Aggregates
100% 15
Millions of Square Feet
95% 10
90% 5
85% 0
80% -5
75% -10
2021F
2022F
2023F
2024F
2025F
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Net Absorption (RS) New Construction (RS) Occupancy Rate (LS)
Source: CBRE Limited; CBRE Econometric Advisors
Toronto and Montreal saw significant reductions in occupied primarily to the ongoing impacts of the pandemic. As a result,
space over the first three months of 2022. More than 1.0 vacancy levels continued to rise. The national vacancy rate
million square feet of space was returned to the market in the rose another 40 bps to 16.3% over the first quarter. The
Greater Toronto area and just over 815,000 square feet in downtown national average moved 70 bps higher to 16.6%,
the Greater Montreal area. In addition, Ottawa and Waterloo while the suburban average edged 30 bps higher to 16.1%.
region posted declines in occupied space of 167,866 square Leasing market conditions were tightest in Vancouver and
feet and 116,851 square feet, respectively. In Western Ottawa, which boast averages of 7.0% and 8.6%, respectively.
Canada, all four metros registered modest increases in Over the balance of 2022, vacancy levels may continue to
occupied space over the first quarter. Nationally, tenants rise. The delivery of new supply will result in additional upward
continued to adjust to changes in how space is utilized, due vacancy pressure and likely downward pressure on rents.
2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 6 / NEXTLEASING REPORT Q1 U P DAT E
MORGUARD
AVAILABLE SUPPLY REMAINED CRITICALLY INDUSTRIAL DEMAND
INDUSTRIAL DEMAND&&SUPPLY
SUPPLY
LOW NationalNational Historical
Historical & Forecast
& Forecast Aggregates
Aggregates
Industrial supply remained critically low in the first quarter, 10 0% 50
40
Millions of Square Feet
in keeping with the recent trend. The national availability 95 %
30
rate rested at an all-time low of 1.6% as of the end of March 90 % 20
2022. The rate had dipped 20 bps quarter-over-quarter and 85 % 10
was down 130 bps from a year ago. The country’s three 80 %
0
-10
largest metros boasted availability rates of 1.0% or lower
75 % -20
as of the end of the first quarter. Vancouver, Toronto, and
20 21F
20 22F
20 23F
20 24F
20 25F
20 00
20 01
20 02
20 03
20 04
20 05
20 06
20 07
20 08
20 09
20 10
20 11
20 12
20 13
20 14
20 15
20 16
20 17
20 18
20 19
20 20
Montreal posted average availability rates of 0.9%, 0.8%,
Ne t Abso rption (R S) Ne w Con stru cti on (RS)
and 1.0%, respectively. Availability was also critically low Occupa ncy Rate (LS)
in the country’s smaller markets, with London, Waterloo, Source: CBRE Limited; CBRE Econometric Advisors
Ottawa, and Halifax posting rates of 2.0% or lower. Despite
the availability shortfall, a significant volume of space was
absorbed across the country during the first three months of RETAIL VACANCY RATES
National Trending Across Property Ty pes
2022. Demand outdistanced supply, resulting in the absorption
of approximately 8.6 million square feet. Vancouver, Calgary, 16%
Edmonton, Winnipeg, London, and Toronto registered healthy 12%
increases in occupied space. For many users, however,
8%
expansion and/or relocation options were hard to come by in
most regions of the country. Coincidentally, users have faced 4%
record-high rents. A modicum of relief from the shortage of 0%
Jun-02
Jun-03
Jun-04
Jun-05
Jun-06
Jun-07
Jun-08
Jun-09
Jun-10
Jun-11
Jun-12
Jun-13
Jun-14
Jun-15
Jun-16
Jun-17
Jun-18
Jun-19
Jun-20
Jun-21
Dec-02
Dec-03
Dec-04
Dec-05
Dec-06
Dec-07
Dec-08
Dec-09
Dec-10
Dec-11
Dec-12
Dec-13
Dec-14
Dec-15
Dec-16
Dec-17
Dec-18
Dec-19
Dec-20
Dec-21
available space is anticipated with the roughly 36.0 million
square feet of new supply underway across the country.
Super Regional Regional
Community Centre Neighbourhood
MODEST UPWARD PRESSURE ON RENTS Source: © MSCI Real Estate 2022
REPORTED
Modest upward pressure on purpose-built multi-suite
residential rental sector rents was reported in the first quarter, CMA'S RENTAL VACANCY
Rates f or Structures of 3 units+
a trend that emerged in the fall of last year. The national
7.3%
average monthly rent increased by 2.7% and 2.1% year-over- Edmonton
7.2%
Calgary 5.1%
year in January and February 2022, respectively, according Winnipeg 5.0%
6.6%
3.8%
to Rentals.ca data. Moreover, the average rent increased by Toronto
3.4%
4.6%
3.4% 3.9%
$10.0 month-over-month. The modest upward rent pressure of Ottawa
3.1%
National 3.2%
the past several months was a byproduct of improved demand Montreal 3.0%
2.7%
patterns. The continued economic recovery, job market gains, Vancouver 1.2%
2.6%
Victoria 1.0%
and the recent rise in immigration volume were supportive of 1.0%
2.2%
Halifax 1.9%
the demand uptick. On a national basis, rental demand has
0% 1% 2% 3% 4% 5% 6% 7% 8%
kept pace with new supply in most regions of the country. 2021 2020
Source: CMHC (Feb 2022 release)
Of the nation’s larger urban centres, Toronto, Winnipeg, and
Abbotsford-Mission were exceptions to this rule. As a result,
vacancy rose modestly in each of the three metros, although
rents continued to rise. Previously, some landlords in several
Industrial supply remained
of the nation’s largest metros offered free rent periods and critically low in the country’s three
other incentives to entice renters. However, as the pandemic’s
impacts eased these perks were offered markedly less largest markets, with Vancouver,
frequently. By the first quarter of 2022, national rental market Toronto, and Montreal boasting
conditions had improved, fueling modest upward rent pressure
and increased landlord optimism. availability rates of less than 1.0%.
2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 7 / NEXTQ1 U P DAT E
MORGUARD
ECONOMIC REPORT
ECONOMIC RECOVERY CONTINUED
Canada’s economic recovery continued to unfold during the first
quarter, despite the emergence of the pandemic’s sixth wave.
National Real Gross Domestic Product rose 0.2% in January,
with a stronger 0.8% preliminary forecast for February. The
January lift represented an eighth consecutive monthly gain. The
Canadian economy is forecast to expand at a relatively robust
rate over the balance of the year, after a solid start to the year.
ECONOMIC
ECONOMIC GROWTH
GROWTH
Real GDP Growth —
Real Historical&&Forecast
– Historical Forecast
8%
6%
5.8
4%
4.5
4.2
3.9
2%
1.0
3.1
3.1
1.0
3.0
2.9
2.9
0.7
2.7
2.7
2.8
0.1
2.3
2.3
1.8
2.3
1.7
2.3
1.9
2.3
1.8
1.5
0%
-2.6
-2.9
-2%
-3.4
-5.2
-4%
-6%
08 09 10 11 12 13 14 15 16 17 18 19 20 21F 22F
Canada United States World
Source: Conference Board Of Canada (Dec 2021); International Monetary Fund (October 2021)
The Omicron variant continued to hamper progress in some services-production output declined, goods-producing output
services-based industries during the first quarter. The was on the rise. The construction, wholesale trade, utilities,
reintroduction of restrictions to reduce the spread of the virus and retail trade sectors posted material output increases in
reduced activity levels and output. Accommodation and food January of 4.3%, 3.1%, 4.0%, and 2.5%, respectively. Over the
services output dropped 11.5% in January, which represented balance of 2022, services sector output is forecast to increase
the most significant decline since April 2020. Transportation steadily, as the effects of the Omicron variant subside.
and warehousing services output fell 3.0% in January, which Services sector expansion will support a relatively robust
was the largest drop since April 2020. Arts, entertainment, national economic growth trend over the next 12 to 24 months,
and recreation output fell 10.8% in January as well. While while goods sector expansion remains relatively moderate.
2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 8 / NEXTECONOMIC REPORT Q1 U P DAT E
MORGUARD
UNEMPLOYMENT FELL TO RECORD LOW LABOUR MARKET
LABOUR MARKET
LEVEL Month-Over-MonthTrending
Month-Over-Month Trending
The Canadian labour market continued to tighten during 15 00 14 %
10 00
the first quarter, with unemployment falling to a record-low 12 %
50 0
level. The national unemployment rate stood at 5.3% as
Thousands of Jobs
0 10 %
of the end of March 2022, a low point dating back to 1976 -50 0
when comparable data first became available. The rate -10 00 8%
dropped 120 bps from a rate of 6.5% at the end of January. -15 00
6%
-20 00
The downward pressure on the unemployment rate was a
-25 00 4%
byproduct of employment gains registered in both February 08 09 10 11 12 13 14 15 16 17 18 19 20 21
Empl oymen t Growth (LS) Un empl oymen t Ra te (R S)
and March. Employment rose by a robust 337,000 in February,
with the relaxing of pandemic restrictions. The employment Source: Statistics Canada
surge followed January’s 200,000 drop off due to stricter
public health measures implemented to combat the spread of
the Omicron variant. The broad-based strengthening of the RETAIL
RETAILSALES
SALES
Month-Over-Month
Month-Over-Month Trending
national labour market during the first quarter was evidenced
in increased hours worked and wages. Total hours worked 30 % $6 0
rose 3.6% and 1.3% in February and March, respectively. 20 % $5 5
The increases followed a 2.2% decline in January. Average 10 % $5 0
Millions
hourly wages increased in each of the three months of the 0% $4 5
first quarter. Since the fall of 2021, Canada’s labour market -10 % $4 0
has proven its resilience against a backdrop that included the -20 % $3 5
ongoing public health crisis, supply chain challenges, and a
-30 % $3 0
08 09 10 11 12 13 14 15 16 17 18 19 20 21
record-high number of unfilled employment vacancies. The
Mon th /Mo nth % Cha nge (L S) Mon th ly Leve l (RS)
record-low unemployment rate of the first quarter provided
Source: Statistics Canada
concrete evidence of this resilience.
EXISTING HOME SALES ACTIVITY
CONTINUED TO RISE HOUSING
HOUSINGMARKET
MARKET
Monthly Monthly
Trends Trends
Canadian existing home sales volume continued to rise in the
35 0 8%
first quarter. In February, approximately 58,200 units were
30 0 7%
sold, representing a high dating back to April 2021. National
25 0 6%
sales rose 4.6% month-over-month in February. Sales
Thousands
20 0 5%
volume increased in four of the country’s 10 provinces, with
15 0 4%
Alberta, Manitoba, Saskatchewan, and Ontario leading the 10 0 3%
way. Existing home sales activity rose sharply in Calgary and 50 2%
Edmonton in February 2022. Sales climbed to a record-high in 0 1%
08 09 10 11 12 13 14 15 16 17 18 19 20 21
both metros, due in part to a significant increase in available
Ho usin g Sta rts (LS) 5-Ye ar Mortgag e Rate (RS)
listings. Nationally, new listings surged by 24.0%, month-
Source: Statistics Canada, CMHC, Bank of Canada
over-month, with Calgary and Edmonton leading the way. The
national average existing home sale price continued to rise
during the first quarter, despite the introduction of new listings.
The national average sale price rose 2.3% month-over-month
The nation’s unemployment rate
in February, with Alberta posting a 5.2% increase. The MLS dropped to 5.3% during the first
home price index registered a 30.4% year-over-year spike
in detached home values in the same month. The continued quarter, which represented a low
upward price pressure of the first quarter coincided with point dating back to 1976.
increased sales activity, despite the prospect of higher interest
rates over the near term.
2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 9 / NEXTQ1 U P DAT E
MORGUARD
INVESTMENT MARKET
TRANSACTIONS
OFFICE
PROPERTY DATE PRICE SF PSF PURCHASER CITY
Choice REIT Portfolio. Mar-22 $794.0 M 1,229,694 $646 Allied REIT Van/Tor/Mon
Blair Park of Commerce Feb-22 $60.0 M 428,000 $140 Crown Realty Partners Ottawa
Royal Bank Plaza Feb-22 $1,163.0 M 1,471,730 $790 Pontegadea Group Toronto
979, 1031 Bank St Jan-22 $38.1 M 116,226 $328 BTB REIT Ottawa
INDUSTRIAL
PROPERTY DATE PRICE SF PSF PURCHASER CITY
4211 Mainway Mar-22 $17.9 M 93,558 $191 Dream REIT Toronto
2150-2180 Dunwin Dr Mar-22 $29.2 M 75,900 $385 Torcom Realty Toronto
10 North Queen St Feb-22 $42.0 M 127,600 $329 TAS/LaSalle Toronto
1580 Eiffel St/1149 Marie-Victorin Feb-22 $58.5 M 186,278 $314 Montez Montreal
1055 Clark Blvd Feb-22 $44.7 M 205,000 $218 Soneil Investments Toronto
**2039 Airport Perimeter Rd Feb-22 $38.2 M 210,429 $181 Nobel REIT Edmonton
250 Bowie Ave/670, 680 Caledonia Feb-22 $100.0 M 265,000 $377 BentallGreenOak/Hullmark Toronto
8550 Montview Rd Jan-22 $42.0 M 234,093 $179 Brasswater Montreal
1120 Birchmount Rd Jan-22 $45.0M 220,465 $204 Pure Industrial REIT Toronto
67 Toll Rd Jan-22 $32.8 M 307,737 $106 Cedar City Developments Toronto
130-160 Bradwick Dr Jan-22 $41.3 M 124,115 $332 Pure Industrial REIT Toronto
222 Citigate Dr (90.1% interest) Jan-22 $494.0 M 2,800,000 $196 Crestpoint Ottawa
Skyline Ottawa Portfolio Jan-22 $154.5 M 692,613 $223 Woodbourne/Epic Ottawa
8072, 8120 Transcanada Hwy Jan-22 $30.8 M 152,187 $202 Triovest Montreal
Skyline GMA Portfolio Jan-22 $80.1 M 402,709 $199 KingSett Capital Montreal
1710-1750 Transcanada Hwy Jan-22 $29.0 M 104,101 $279 KingSett Capital Montreal
2525, 2605 Jean-Baptiste Desch. Jan-22 $37.0 M 252,850 $146 Sun Life Assurance Montreal
8301 Keele St Jan-22 $50.6 M 275,000 $217 Soneil Investments Toronto
1120 Birchmount Rd Jan-22 $45.0 M 220,465 $204 Pure Industrial REIT Toronto
RETAIL
PROPERTY DATE PRICE SF PSF PURCHASER CITY
851-887 Queen St E Mar-22 $17.0 M 16,274 $1,045 Stamina Ontario Investmts. Toronto
4051-4059 New St Feb-22 $19.8 M 55,561 $354 Fieldgate Commercial Toronto
Refinery Row Feb-22 $14.5 M 26,055 $555 LS Properties Edmonton
Valley Fair Mall Jan-22 $76.0 M 139,000 $547 Revs Entertainment Group Vancouver
CF Carrefour Laval (16.7% interest) Jan-22 $222.8 M 1,242,990 $1,075 TD Greystone Asset Mgmt Montreal
Laurentian Place (50% interest) Jan-22 $41.0 M 273,143 $300 Calloway REIT Ottawa
MULTI-SUITE RESIDENTIAL
PROPERTY DATE PRICE # UNITS /UNIT PURCHASER CITY
Cons Quebec Portfolio Mar-22 $281.0 M 516 $544,574 CAPREIT Mon/St Hayaci
1570 Lawrence Ave W Feb-22 $33.8 M 87 $387,931 Pulis Investments Toronto
263, 265 Dixon Rd Feb-22 $141.0 M 352 $400,568 Akelius Toronto
265 Hymus Blvd Feb-22 $53.8 M 135 $398,321 Firm Capital Montreal
45 Trayborn Dr Jan-22 $24.0 M 62 $387,097 Q Residential Toronto
5 Mallory Gardens Jan-22 $27.9 M 60 $465,000 Akelius Toronto
** leasehold interest
2 0 2 2 C A N A D I A N E C O N O M I C O U T L O O K A N D M A R K E T F U N D A M E N TA L S PREV / 10 / NEXT| Q1| U P DAT E
MO
M GU
ORRG ARD
UA
ABOUT
Morguard is a fully integrated real estate company with a diversified, high-quality portfolio
of assets across North America. We have built our business with strong leadership, proven
management and significant long-term growth for over 45 years. As of March 31, 2021, Morguard
had $19.9 billion of total assets under management and employed 1,300 real estate professionals
in 12 offices throughout North America.
Publicly Traded Real Estate Company Morguard Corporation
Publicly Traded Real Estate Investment Trusts Morguard REIT
Morguard North American Residential REIT
Real Estate Advisory Company Morguard
Real Estate Brokerage Morguard Investments Limited
Investment Management Company Lincluden Investment Management Limited
ACKNOWLEDGEMENTS / RESEARCH RESOURCES
In the course of compiling the statistical information and commenting on real
estate markets, national, regionally and across Canadian metropolitan areas, we
acknowledge the assistance and feedback from the following parties in completing
this report:
The Altus Group, Avison Young, Bank of Canada, Bank of Japan, BMO Economics,
BMO Nesbitt Burns, CBRE Econometric Advisors, CBRE Limited, CIBC World
Markets, Canada Newswire, Canadian Mortgage and Housing Corporation (CMHC),
Canadian Mortgage Loans Services Limited, The Canadian Real Estate
Association (CREA), Colliers International, Conference Board of Canada,
Cushman & Wakefield, Developers and Chains e-news, Economy.com,
European Central Bank, The Federal Reserve Board, Frank Russell Canada (RCPI),
The Globe and Mail, ICR Commercial Real Estate, International Council of Shopping
Centres (ICSC), Insite-Altus Research, International Monetary Fund, The Johnson
Report (Winnipeg), Jones Lang LaSalle, MSCI, The Network, Ottawa Business
Journal, PC Bond Analytics, PricewaterhouseCoopers, RBC Capital Markets,
RBC Economics, RealNet Canada Inc., Statistics Canada, Scotia Capital,
TD Economics, Toronto Star, Torto Wheaton Research, Urban Land Institute,
United States Department of the Treasury, York Communications
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RTA M E N TA L S PREV / 11
/ 82/ /NEXTFORWARD-LOOKING STATEMENTS DISCLAIMER
Statements contained herein that are not based on historical or current fact, including
without limitation statements containing the words “anticipates,” “believes,” “may,”
“continue,” “estimate,” “expects” and “will” and words of similar expression, constitute
“forward-looking statements.” Such forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause the actual results, events
or developments to be materially different from any future results, events or developments
expressed or implied by such forward-looking statements. Such factors include, among
others, the following: general economic and business conditions, both nationally and
regionally; changes in business strategy; financing risk; existing governmental regulations
and changes in, or the failure to comply with, governmental regulations; liability and other
claims asserted; and other factors. Given these uncertainties, readers are cautioned
not to place undue reliance on such forward-looking statements. The publisher does not
assume the obligation to update or revise any forward-looking statements.
Copyright © 2022 by Morguard Investments Limited. All rights reserved.
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for reproduction please contact:
Keith Reading
Director of Research
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kreading@morguard.com
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