Avison Young in Regina
Since opening in 2004, Avison Young’s Regina office has provided services to a diverse range of owners and occupiers throughout Saskatchewan while developing contacts and clients throughout North America. Regina-based brokers, in collaboration with their national and international colleagues, clearly understand and respect client needs while remaining dedicated to a philosophy that incorporates five principles – transparency, integrity, creativity, hard work and results. Working closely with other offices across the Avison Young family, Regina’s professional sales and support team strives to achieve excellence with multi-market sale and lease transactions across all commercial real estate asset classes.
Regina had a census metropolitan area (CMA) population of 241,222 in 2016 which represented an 11.4% increase from the previous major StatsCan report in 2011. As the capital city in the province, it has a strategic location to north-south and east-west traffic, affordable real estate, a reasonable cost of living and commutes of less than 20 minutes to work. The regional economy is buoyed by a strong industrial sector (mining, oil, gas and manufacturing), transportation and logistics, health, education, research and technology. The city has a market draw area of approximately 500,000 from the U.S. border to adjoining provincial boundaries. Regina has a progressive and culturally-diverse arts and heritage community, and is home to the province's professional football franchise. Recent and ongoing mega-projects have helped to propel Regina into an exciting era; the city is expected to sustain its position in western Canada as a city of opportunity for generations to come.
Regina’s office market has plateaued in recent years and can best be viewed as balanced and somewhat weakened in terms of absorption and growth. Landlords are faced with numerous challenges filling their vacant space, while tenants are able to consider multiple options that offer incentives and negotiable lease rates. Limited new construction in 2018 has kept the vacancy rates for competitive and non-competitive office space at 8% throughout the later part of the year, with inventory of 7.1 million square feet as of November 2018.
The retail market enjoys ongoing growth in new and redeveloping sectors of the city. Growth and construction are underway in the west, northwest and east corridors of the city. Retail inventory has grown significantly over the past years, primarily in the Harbour Landing and Greens on Gardiner areas. The city is not immune to trends within the retail industry, specifically e-commerce, but it remains a stable and resilient market for consumers and retailers alike. Given the strong growth in retail spending, with stable and disposable household income, this trend is expected to continue in the future. The current retail vacancy rate for Regina is 3%.
The realignment and stabilization of assets in Regina's industrial market continued in 2018. Development land costs have stabilized and serviced land is very abundant inside the CMA. The market corrections in vacancy and lease rates have run their course, and construction costs have stabilized due to the increasingly stable economy. Serviced land ranges from $200,000 to $500,000 per acre in the region, while net lease rates on new space remaine stable at $13.00 psf.
Regina's investment market has been strong in recent years and is expected to remain very stable despite a relative lack of product when compared to cities of similar size. Multiple buyers continue to be interested in any product that becomes available. Downward pressure on office lease rates could provide buying opportunities for investors in 2019, while cap rates will likely rise slightly.