BC Coastline is being bought up,MAY 2014

WESTERN INVESTOR MAY 2014
Lower Mainland A11 A“quantum leap” forward into foreign real estate by mainland Chinese investors is expected this year, and recent British Columbia sales show it may include a deep dive into B.C. recreational real estate. Since January, buyers from mainland China have bought the Sechelt Golf and Country Club on the Sunshine Coast north of Vancouver (the price remains undisclosed), a 46-acre island off the Sunshine Coast for $2.5 million and the Garden Bay Resort near Pender Harbour. Late last year, a Chinese travel company bought a downtown commercial lot in Nanaimo, where it plans to build a $50 million hotel that will cater to Chinese tourists.This year, a buyer from mainland China also purchased a 156-acre riverfront equestrian farm in Langley for $5.5 million. “It had been rare to see mainland China buyers purchasing recreational property in B.C,” said Mark Lester, senior vice-president of Jones Lang LaSalle Real Estate Ltd. (JLL). Lester, who chaired a recent Vancouver panel discussion on Asian real estate investment in Canada, believes the recent moves into recreational property reflect a “maturing” of China investors. “[They] have moved beyond houses on Vancouver’s West Side and Richmond.” A study of outward-bound Chinese investors by Colliers International also forecasts a greater diversity in foreign locations and property sectors this year. “Besides increasing global liquidity, the volume of outbound investments from Asia is being driven by both ‘pull’ and ‘push’ factors,” explains Piers Brunner, CEO, Asia, at Colliers International. Brunner said buyers are being “pushed” by China’s new and tougher regulations on real estate investing and “pulled” by the potential of higher returns in foreign markets. $15 billion “Chinese outbound property investments beyond Asia really took off in 2009, and reached US$9 billion in 2013. We believe more Chinese developers will look overseas to support the needs of their local clientele,” added Terence Tang, managing director of capital markets and investment services, at Colliers Shanghai office. “We think the world’s ‘gateway’ cities will see a quantum leap in real estate purchases by Chinese buyers in 2014.” COVER B.C. coastline capturing latest wave of China-based vacation investors FRANK O’BRIEN WESTERN INVESTOR JLL is forecasting total offshore real estate investments by China investors at $15 billion in 2014, and this does not include individuals purchasing homes or small commercial holdings. Vancouver-based Lucy Fletcher, JLL’s vice-president, international capital group, said her office is seeing Chinese investor groups “on a daily basis.” JLL research shows China’s investors are increasingly seeking development opportunities, rather than purchasing existing assets, but Fletcher said most of these want to keep their developments closely held. “They are not really interested in typical 50-50 JVs [joint ventures],” she said, “They prefer a 90-10 or 70-30 venture with local developers.” Fletcher said Vancouver is hampered only by a lack of land. China’s developers are looking for greenfield sites of at least 15 acres, she said, “which are hard to find in Metro Vancouver.” David Green-Morgan, JLL’s global capital markets research director, said Canada now has one of the world’s lowest proportions of foreign investment in commercial real estate. But, he said, the Chinese government is “actively encouraging” its developers to invest in foreign real estate projects, and “more and more investors are turning their attention toward Canada.” A driving force for China’s recreational investors is Canada’s recent attribution by the Chinese government as an “approved tourist destination,” Green-Morgan added. Each year 83 million Chinese tourists visit a foreign country.X An investor from mainland China purchased the 46-acre Fox Island off the Sunshine Coast north of Vancouver for $2.5 million. Plans are in place for a five-lot subdivision. Lucy Fletcher, vice-president, international capital group with Jones Lang LaSalle. Vancouver office now sees China investor groups “on a daily basis.” Realtor Mark Lester: China-based investors are now scouting recreational and commercial real estate in B.C: “[They] have moved beyond houses on Vancouver’s West Side and Richmond.” Offshore buyers dive into recreational SCAN WITH LAYAR TO SEE WHY FOREIGN BUYERS LOVE CANADA Photo: Jones Lang LaSalle Photo: Kim Stallknecht Photo: Jones Lang Lasalle jll.ca JLL | 21st Floor, 400 Burrard Street, Vancouver BC, V6C 3A6 | Tel +1 604 998 6016 8890 School Street, Chilliwack • 1.02 Acre Commercial Site • Drive-through retail potential • $1,100,000 263 Gower Point Road, Gibsons • 0.65 Acre Mixed-Use Development Site • Over 210’ of water frontage • $2,000,000 11015 -100 Street, Fort St. John • 1.36 Acre Prime Multi-Family Development Site • Corner site • $700,000 852 Victoria Street, Kamloops • 17,859 SF Service Commercial Site • Improved with 3,000 SF building • $450,000 606 East Victoria Road, Revelstoke • 0.768 Acre Industrial Land • +LJKSUR¿OHORFDWLRQ • $140,000 38138 Loggers Lane, Squamish • 30,195 SF Waterfront Development Site • Rezoning potential for multi-family residential • $1,100,000 4760 Keith Avenue, Terrace • 6.33 Acre Industrial Site • Commercial redevelopment potential • $1,400,000 1648 Alaska Avenue, Dawson Creek • 1.30 Acre Commercial Development Site • +LJKSUR¿OHORFDWLRQ • $450,000 1802 Versatile Drive, Kamloops • 1.35 Acre Industrial Land • Close proximity to several national retailers • $795,000