Market Information

Spring 2006

As witnessed throughout 2005, 2006 is seeing continual pressure in every sector of commercial real estate.

Industrial land, hence lease prices, have skyrocketed.

Commercial developments are leased before they are constructed.

Professional buildings are filled with new, large hi-tech businesses.

 Investment properties are few and far between.

Development land has practically disappeared.

What's fuelling the contant growth?

Simple. Where can you find a safer, cleaner, friendlier, well designed, intelligently structured, "moving forward" city than Kelowna?

Four distinctive seasons, excellent activities for all ages and sports, 100 kilometer lake, over 35 golf courses, excellent resort mountains an hour away, and most of all, a beautiful community.

Business, investment and residential opportunities are attracting outside interest at a pace never seen before.

The most sought after real estate is still large tracks of commercial development land.

With most "potential" development land being held in the Agricultural Land Reserve, we are seeing interest in investors purchasing holding of 20 acres plus, mostly close in, with the hope that the land will be removed from the ALR within a reasonable period of time. It would seem that sooner or later mounting pressure will be applied to this group to consider applications for removal.

Typical holding properties within the Kelowna boundaries can be acquired presently for between $80,000.00 - $135,000.00 per acre, and the assumption is that these properties, if zoned "high density residential" would be worth approximately $500,000.00 per acre.

Another very desired product is tenanted commercial / industrial buildings. The required capitalization rate (rate of return) has dropped from 10 % two years ago, to between 7 & 8 %, or even lower where solid Triple "A" tenants are involved.

Worthwhile" Businesses are always in heavy demand in Kelowna, both small and large, and when they become available they seem to be purchased incredibly fast.Our market is not one for procrastinators. It's been proven time after time that if you hesitate, you lose.

I've been involved directly with major brokerage firms who attempted to buy at a reduced rate, or ask for too much time to close, only to see another party move in and pay a higher amount and close quickly.In each case, the buyer who missed the opportunity wonders why they did, while the real buyers enjoy the rewards for being confident in the market.

So what does the future hold? How long will the demand stay strong? Will the values decline, increase or stabilize? Who knows?

The investment and development groups I work with are confidant that property values will continue to rise, as the population growth in Kelowna and area seems unstoppable.

If you are interested in learning more about our market, feel free to email or call me direct.

For additional up to date information, please go to Links, where I have included several options for you to turn to for specific information on our fantastic community.