CALGARY – In the first half of this year, there were no commercial real estate transactions involving downtown office buildings in Calgary.
Last year there were seven sales for $364.5 million.
But research by Barclay Real Estate Limited in Calgary indicates five office properties have changed hands in Beltline ($41.9 million) and seven in the suburban office market ($151.7 million) during the first six months of 2009.
“Due to the challenges that purchasers are having obtaining financing, especially for more than $10 million, sales have generally been smaller in size than a year ago,” said an investment review by the commercial real estate company. “The largest office transaction for the first half of 2009 was the transfer of the Westwinds Business Centre in the city’s northeast. The property was transferred from Nortel to the City of Calgary for $97 million in June, representing a price per square foot of $166.”
The investment review said that last year public companies and institutions were very active in the market and made up the majority of transactions while this year has been quite a different story.
“In Q2 2009, private companies were the most active purchasers and accounted for 68 per cent of transactions,” said the review. “Government and users made up the remaining purchasing groups at 16 per cent each. In Q2 2009, 68 per cent of deals completed were located in the Beltline office market with the remaining 32 per cent occurring in the Suburban office market. The Downtown office market had no transactions completed in 2009.”
Overall in the office market, total dollar volume for the second quarter of this year was $154.8 million, up from $38.8 million in the first quarter but down from the $598.1 million in the second quarter of 2008.
Transaction volume remained unchanged from the previous quarter, recording six sales. Average price per square foot increased 13 per cent from the first quarter to $326 for the second quarter.
Total dollar volume for the first six months of this year was $193.6 million compared with $694.1 million for the same period last year. There were 12 office sales in the first two quarters of 2009 compared with 23 a year ago.
mtoneguzzi@theherald.canwest.com
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