New Real Property Association of Canada survey shows Canadian commercial real estate markets holding up well compared to the US



    TORONTO, Aug. 6 /CNW/ - Today, the Real Property Association of Canada
(REALpac) was pleased to release a new quarterly economic survey which will
serve as a gauge of senior real estate executives' confidence in financial and
real estate markets in Canada. The REALpac/FPL Canadian Real Estate Sentiment
Survey measures executives' current and future outlook in three areas
including overall real estate conditions, real estate asset values, and
availability of capital. Three Sentiment Indices comprise the survey including
a Current Conditions, Future Conditions and Overall Conditions Index.
    The inaugural Canadian survey captured the thoughts of 54 leading real
estate executives, including CEOs, presidents, board members, and other
executives from a broad set of real estate sectors including owners and asset
managers, financial services providers, and building operators and related
service providers. Survey respondents represent income producing real estate
including office buildings, retail shopping centres, industrial buildings,
hotels, multi-family residential (apartment buildings), and seniors
residences.

    
    The topline findings of the survey include the following:
    -  Current conditions are seen as quite weak in comparison to a year ago;
       significant improvement is not expected in the next year.
    -  Respondents report a significant decline in asset values and have
       little hope for near-term improvement; U.S. asset values appear to be
       more stressed.
    -  According to respondents, access to capital is severely restricted
       today and any recovery is expected to be anemic.
    -  Canadian sentiment is in-line with U.S. sentiment, which has ticked up
       since last quarter. (NB: The REALpac/FPL Canadian Real Estate
       Sentiment Survey is directly comparable to the Real Estate Roundtable
       Sentiment Survey, conducted by FPL Advisory Group in the United
       States.)
    

    Outlook on Real Estate Conditions

    The commercial real estate executives surveyed during the first two weeks
of July believe that current conditions in Canada remain quite weak in
comparison to a year ago and that significant improvement is not expected in
the next year. One respondent noted that "it will take economic stability and
a return of the financial sector to get things moving again" while another
added, "we won't see a rebound until we see some job creation and confidence
in retail sales".

    Real Estate Asset Values

    While respondents reported a significant decline in asset values and see
little hope for near-term improvement, asset values in Canada have held up
better than those in the U.S. However, while top quality buildings appear to
be holding their value, according to one respondent, "B and C buildings are
not".

    Availability of Capital

    According to respondents, access to capital is severely restricted today
as compared to a year ago. One respondent indicated that "money is available;
it's just more expensive and comes with more strings attached". In the future,
respondents expect any recovery to be slow and weak.

    Overall Sentiment

    The Overall Index is measured on a scale of 1-100 and represents an
average of the Future Conditions Index and the Current Conditions Index. To
register an Index of 100, all respondents would have to answer that they
believe conditions are "much better" today than one year ago and will be "much
better" one year from now.
    In the U.S., for the third consecutive quarter, the Real Estate
Roundtable Sentiment Survey's Current Index rose from 38 in January 2009, to
41 in April, to 49 in July. Similarly, the Current REALpac/FPL Canadian Real
Estate Sentiment Index rests at 50. In this inaugural edition of the survey,
Canadian sentiment tracked very closely to those of U.S. real property
executives, which has improved slightly since last quarter, though with a
slightly more positive perspective. As one respondent noted, "Canada does not
have the same degree of deleveraging issues as the U.S. The banks are not as
overextended in commercial real estate. The question is whether the negative
sentiment there will spill over to Canada."
    "The REALpac/FPL Canadian Real Estate Sentiment Survey is the industry's
most comprehensive measure of senior executives' confidence in the Canadian
commercial real estate industry", said Michael Brooks, Chief Executive Officer
of REALpac. "We are confident that the survey will come to be regarded as an
indispensible tool and invaluable decision-making resource for federal and
provincial policymakers, real estate industry participants and others, north
and south of the border, who seek a timely and relevant snapshot of current,
future and overall conditions in Canadian real estate markets. Real estate
investors and developers make decisions today based on sentiment about
tomorrow, so this survey is an important current and leading indicator for our
industry" added Brooks.
    To download a copy of the survey, please visit the REALpac website at
www.realpac.ca.

    About the REALpac/FPL Canadian Real Estate Sentiment Survey

    As Canada's most comprehensive measure of senior executives' confidence
in the Canadian commercial real estate industry, the "REALpac/FPL Canadian
Real Estate Sentiment Survey", conducted by FPL Advisory Group on behalf of
the Real Property Association of Canada, captures the perspectives of senior
real estate executives from a broad range of industry sectors including
owners, developers and managers, financial service firms, and consultants
representing major asset classes including office, retail, industrial,
multi-family residential, hotel, seniors residential, and hotel, across
Canada. The "REALpac/FPL Canadian Real Estate Sentiment Survey" is directly
comparable to the "Real Estate Roundtable Sentiment Survey", conducted by FPL
in the United States.

    About the Real Property Association of Canada

    REALpac is Canada's premier industry association for investment real
property leaders. Our mission is to collectively influence public policy, to
educate government and the public, and to ensure stable and beneficial real
estate capital and property markets in Canada.
    REALpac Members currently own in excess of $150 Billion CAD in real
estate assets located in the major centres across Canada. Members include real
estate investment trusts, publicly traded and large private companies, banks,
brokerages, crown corporations, investment dealers, life companies, lenders,
and pension funds. For more information, please visit us at www.realpac.ca.

    About FPL Advisory Group

    FPL Advisory Group ("FPL") is a family of companies focused on providing
highly specialized advisory services to the real estate and related operating
and financial services industries. Through our complementary practice areas,
we work with our clients to develop the right talent, leadership, structure,
and strategies for success in today's intensely competitive marketplace.
    FPL is comprised of two primary operating companies that work together to
serve a common client base. Ferguson Partners provides executive, director,
and professional search services. FPL Associates provides a range of
specialized consulting and finance-related services in the areas of
compensation, management consulting, executive onboarding, and succession
planning. The firm is headquartered in Chicago and maintains offices in
London, New York, San Francisco, and Tokyo. For more information, please visit
www.fpladvisorygroup.com.





For further information:

For further information: Michael Brooks, CEO, REALpac, (416) 642-2700
x.225, or Jonas Bordo, Senior Director, FPL Advisory Group, 888-368-6598 (toll
free).

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