We’ve just released our 2Q21 market surveys and all three sectors are reporting a reduction in vacancy.
Remarkable statistics considering the economic storm we’ve been passing through!
It appears that our resource rich economy is only going to continue to improve with the recent upcycle in commodity markets.
International demand for food, fertilizer and fuel have turned the corner after a slow 2020.
Let’s take a look at each sector individually.
Saskatchewan has entered step three of our reopening plan and most restrictions from public health orders have been lifted.
But does that mean we should all go back to business as usual?
I think there are a few pandemic measures we could all just continue with.
Any discussion on cap rates needs to be prefaced with a cautionary note.
That is, there are many factors that determine capitalization rates on a commercial real estate investment.
Those factors include but aren’t limited to age and condition of improvements, covenant of tenants, term of leases, location, asset class and the tenant mix.
In many larger jurisdictions, commercial brokers focus on one asset class such as office, industrial or retail.
They do that because they know that to service their clients, it’s necessary to have a high degree of knowledge in one area.
In Saskatchewan we do not have that luxury.
Saskatchewan’s premier Scott Moe is optimistically eying reopening our province (again) to business despite some of our neighbouring provinces tightening down.
As much as I strongly believe safety is a high priority, I also believe salvaging our economy is just as important.
So what does Moe’s re-open plan mean for business?
Have you ever found yourself in a situation where you believed that it was in the best interest of someone you know to plan for change, but failed to convince them of your belief?
Sometimes thoughtfully framed stories can be more impactful than our best efforts to convince.
Let me explain.
Regina City Council was publicly criticized last week for a land sale they engaged in with an undisclosed buyer.
Some of the outcry is from adjacent property owners who may or may not have had use for the land themselves.
But any criticism from the general public about the cloak and dagger secrecy of the sale may not be fair.
Who is counting down to travelling again?
Hopefully, you’ve been adhering to government guidelines like the rest of us with the belief that our sacrifice is for the greater good of all.
Staying stuck at home, though, has only caused me to watch more TV and movies which in turn have made me long for adventure.
Smart companies will look beyond potential cost savings and base their decision on how to best invest in their most important asset…their employees.
I’m often asked what I believe will be the impact of the work from home transition on office occupancy.
I think it’s a matter of planning and investing where the money will be best served.
I promised you that I’d hold myself accountable in my Jan 2020 post and report back to you.
So, how did I do? At that time, I predicted a decline in the overall Saskatoon industrial vacancy rate from 5.65 per cent per cent in 2019 to 4.8 per cent.
That’s after a significant 2 per cent decline in 2018 and a 0.9 per cent decline to 6.8 per cent in 2019.