TORONTO, Feb. 13, 2013 /CNW/ - Canadian commercial real estate delivered another strong performance in 2012, as measured by the REALpac / IPD Canada Annual Property Index.
The annual total return of 14.1% continued Canada's strong performance. Real estate outperformed public equities (7.5%), bonds (3.0%) and inflation (0.8%). (Equities are based on the MSCI Canada Index. Bonds are based on the JP Morgan 7-10 Year Government Bond Index. Inflation is based on data from Statistics Canada).
Looking at the 13 year history of the REALpac / IPD Canada Annual Property Index, 2012 was the 5th highest annual total return ever.
Total annual returns for the three years, five years, and ten years ending December, 2012 remain robust at 13.6%, 8.7% and 11.7% respectively.
Examining the four major property sectors, residential registered the only increase in total return in 2012 (16.2%, up from 11.9% in 2011). Total returns for office properties, which spiked between 2010 and 2011, pulled back only slightly in 2012 to 15.9% while industrial and retail produced lower total returns in 2012 (11.8% and 13.5% respectively) compared to 2011.
Overall, the six largest commercial property markets generated healthy total returns in 2012. Of the six largest markets, Edmonton was the only metro that saw accelerating growth in value. Calgary, Toronto, Montreal, Vancouver and Ottawa all produced healthy but lower returns in 2012 when compared to 2011.
IPD provides real estate benchmarking and portfolio analysis services to clients in over 30 countries around the world. These services incorporate more than 1,500 funds containing nearly 70,000 assets, with a total capital value of over USD 1.4 trillion. Each year, IPD produces more than 120 indices helping real estate market transparency and performance comparisons, as well as nearly 600 benchmarks for client portfolios. IPD is a subsidiary of MSCI Inc., a leading provider of investment decision support tools to investors globally, and clients include real estate investors, managers, consultants, lenders and occupiers.
For further information on IPD, please visit www.ipd.com.
REALpac is Canada's senior national industry association for owners and managers of investment real estate. Its members include publicly traded real estate companies, real estate investment trusts (REITs), private companies, pension funds, banks and life insurance companies with investment real estate assets each in excess of $100 million.
For further information on REALpac, please visit www.realpac.ca.
SOURCE Real Property Association of Canada
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Strong performance in Canadian real estate continues
Feb 13, 2013, 04:00 EST