MULTIFAMILY Sub Market Report Vancouver West Side Jones Lang LaSalle Real Estate Services, Inc. 14th Floor - 355 Burrard Street, Vancouver, BC, V6C 2G6 1 Copyright 2018 Jones Lang LaSalle IP, Inc. All rights reserved.
Sub Market Insights JLL Multifamily BC presents its second Sub-Market Report focused on Vancouver s West Side, encompassing the neighbourhoods of Fairview, Kerrisdale, Kitsilano, and Marpole. In 2017 the number of apartment building transactions and their dollar volume is down from a banner year in 2016, but this hasn t restrained the median price per residential unit on the West Side which grew another 16% to 488,800. Furthermore, the average cap rate compressed 20 basis points further to 2.37%, which is a record low for this metric. The respective neighbourhoods in the West Side each share a similar story, with the exception of Kerrisdale, true to its tenure, changing very little year over year. The volume of transactions, median price per unit, and average cap rate remain nearly unchanged compared to 2016. Focusing on Kitsilano, which historically is one of Vancouver s most popular rental neighbourhoods, especially for the younger demographic of rental tenants, the median price per unit increased by nearly 150,000 from 2016 to 2017. Concurrently, and unique to Kitsilano compared to other neighbourhoods, the average cap rate increased. This market shift is primarily due to a relatively high sale volume (four different transactions) of turnkey buildings with stabilized market rental revenue in place. This shift is reflected in the overall average cap rate of 3.19%. Massive price per unit values metrics were achieved for these stabilized assets, such as 771,429/unit for the JLL transaction at 2200 W 5th Avenue that also offered a cap rate of 3.71%, proving that turn-key properties are very cap rate driven and the price per unit metric is less relevant to market investors. The Fairview neighbourhood benefits from a strategically central location, with a dense concentration of apartment buildings often sitting on large high-rise designated lots. Several owners in Fairview have long been waiting for a ripe political environment 2 to redevelop these under densified properties to their highest and best use by unlocking the latent land value. There is also hype surrounding the Broadway SkyTrain extension of the Millennium Line which intensified in 2017 pursuant to provincial and federal budget allocation being committed to the project over the next 11 years. This has further added fuel to the land speculation flame seeing per unit values rise dramatically, especially for low rise wood-frame buildings in strategic locations. Correspondingly Fairview holds the region s lowest average cap rate of 2.13%. Overall, across Vancouver s West Side cap rates have steadily been compressing over the past five years, while systematically the median price per unit has been rising. This trend, as shown in the graph on the following page, has been led by falling interest rates, which were at historical lows in 2016, but in 2017 the feds kicked the trend with their strategic agenda to gradually and gently raise interest rates. Does this mean cap rates have bottomed out? We would love to hear your thoughts, and look forward to connecting with you to discuss the topic. PATRICK MCEVAY* Vice President T +1 604 789 0720 E patrick.mcevay@am.jll.com JAMES BLAIR* Vice President T +1 604 790 7089 E james.blair@am.jll.com *Personal Real Estate Corporation DAVID VENANCE* Vice President T +1 604 910 3842 E david.venance@am.jll.com CHRIS HAYNE Sales Associate T +1 604 998 6130 E chris.hayne@am.jll.com Sources: RealNet, Commercial Edge, CLS, BC Assessments, and information gained by JLL that we deem reliable. E&OE: The information contained herein was obtained from sources which we deem reliable, and while thought to be correct, is not guaranteed. Statistics include data collected on transactions of dedicated rental properties with five or more units. Development site transactions are excluded from the calculation of the average price per unit and cap rate.
Vancouver West Side Statistics 3.50% 1.50% 500,000 3.00% 1.20% 400,000 INTEREST RATE 2.50% 0.90% 300,000 CAP RATE 2.00% 0.60% 200,000 2013 2014 2015 2016 2017 TOTAL TOTAL OF MEDIAN PRICE PER UNIT AVERAGE CAP RATE CMHC VACANCY RATE 3 2016 2017 51 441,794,000 410,198 2.58% 1.30% 36 372,567,500 488,800 2.37% 1.00% Sources: RealNet, Commercial Edge, CLS, BC Assessments, and information gained by JLL that we deem reliable. E&OE: The information contained herein was obtained from sources which we deem reliable, and while thought to be correct, is not guaranteed.
Vancouver West Side Geographical Areas NEIGHBOURHOOD STATS WEST 4TH AVENUE WEST 16TH AVENUE WEST 33RD AVENUE KITSILANO MACDONALD STREET ARBUTUS STREET WEST BROADWAY FAIRVIEW MEDIAN PRICE PER UNIT KITSILANO 597,292 3.19% FAIRVIEW AVERAGE CAP RATE 544,444 2.13% SOUTH WEST MARINE DRIVE KERRISDALE GRANVILLE STREET OAK STREET CAMBIE STREET WEST 41ST AVENUE WEST 49TH AVENUE KERRISDALE 469,697 2.26% MARPOLE 355,000 2.50% WEST 57TH AVENUE WEST 70TH AVENUE MARPOLE 4
Neighbourhood Breakdown Fairview South Granville, Cambie Village, & Shaughnessy TOTAL 2016 2017 5 TOTAL OF MEDIAN PRICE PER UNIT AVERAGE CAP RATE CMHC VACANCY RATE 17 156,333,000 390,281 2.55% 0.70% 11 129,714,500 544,444 2.13% 0.70% Sources: RealNet, Commercial Edge, CLS, BC Assessments, and information gained by JLL that we deem reliable. E&OE: The information contained herein was obtained from sources which we deem reliable, and while thought to be correct, is not guaranteed.
Fairview ADDRESS SALE DATE SALE PRICE UNITS OR LOT SIZE PRICE/ UNIT or LOT SIZE YEAR BUILT EGI CAP RATE 1 1616 West Broadway OM Feb-17 9,500,000 6,250 sf 1,520 1926 Sold as a Development Site 2 1550 West 11th Avenue Mar-17 12,500,000 27 462,963 1965 375,738 2.14% 3 2777 Oak Street ST May-17 21,500,000 18,753 sf 1,146 1973 Sold as a Development Site 4 1546 West 12th Avenue Jun-17 7,500,000 13 576,923 1927 205,726 2.06% 5 541 West 13th Avenue Jun-17 4,900,000 9 544,444 1912 N/A 2.64% 6 1686 West 12th Avenue HR Jul-17 22,818,000 48 475,375 1968 667,625 1.83% 7 1569 West 12th Avenue Jul-17 5,250,000 10 525,000 1951 130,209 1.71% 8 1225 West 10th Avenue Jul-17 4,996,500 9 555,167 1956 137,202 1.96% 9 3819 Cambie Street Nov-17 10,200,000 22 463,636 1945 299,830 2.10% 10 1385 West 15th Avenue HR Nov-17 14,600,000 19 768,421 1965 494,844 2.56% 11 3591 Oak Street CO Dec-17 15,950,000 26 613,462 1947 N/A N/A WEST 6TH AVENUE WEST BROADWAY MACDONALD STREET ARBUTUS STREET 1 7 6 4 2 10 8 3 5 CAMBIE STREET WEST 16TH AVENUE GRANVILLE STREET 11 OAK STREET 9 6 Development Site SP Share Purchase TH Townhouse MU Mixed-Use MF Multifamily OM Off Market CO Co-Op ST Strata HR High-Rise N/A Not Available Denotes Sales by JLL
Neighbourhood Breakdown Kerrisdale TOTAL 2016 2017 7 TOTAL OF MEDIAN PRICE PER UNIT AVERAGE CAP RATE CMHC VACANCY RATE 7 89,848,000 452,408 2.29% 2.00% 6 98,730,000 469,697 2.26% 1.50% Sources: RealNet, Commercial Edge, CLS, BC Assessments, and information gained by JLL that we deem reliable. E&OE: The information contained herein was obtained from sources which we deem reliable, and while thought to be correct, is not guaranteed.
Kerrisdale ADDRESS SALE DATE SALE PRICE UNITS OR LOT SIZE PRICE/ UNIT or LOT SIZE YEAR BUILT EGI CAP RATE 12 5850 Vine Street Feb-17 8,230,000 21 391,905 1959 N/A 1.90% 13 2346 West 43rd Avenue Feb-17 4,400,000 9 488,889 1954 137,549 2.27% 14 5815 Yew Street SP HR Mar-17 40,000,000 83 481,928 1965 1,500,000 2.69% 15 5410 Balsam Street May-17 15,500,000 33 469,697 1966 552,625 2.43% 16 6020 East Blvd Jun-17 26,000,000 18,731 sf 1,388 1952 Sold as Development Site 17 2181 West 40th Avenue Jun-17 4,600,000 10 460,000 1958 131,323 1.99% 18 6060 East Boulevard Nov-17 11,508,600 9,360 sf 1,230 1956 Sold as Development Site WEST 33RD AVENUE 15 17 WEST BOULEVARD MACDONALD STREET SOUTH WEST MARINE DRIVE 12 13 14 16 18 GRANVILLE STREET OAK STREET WEST 41ST AVENUE CAMBIE STREET WEST 49AVENUE 8 Development Site SP Share Purchase TH Townhouse MU Mixed-Use MF Multifamily OM Off Market CO Co-Op ST Strata HR High-Rise N/A Not Available Denotes Sales by JLL
Neighbourhood Breakdown Kitsilano TOTAL 2016 2017 9 TOTAL OF MEDIAN PRICE PER UNIT AVERAGE CAP RATE CMHC VACANCY RATE 14 109,265,000 450,000 2.33% 1.20% 14 122,373,000 597,292 3.19% 0.70% Sources: RealNet, Commercial Edge, CLS, BC Assessments, and information gained by JLL that we deem reliable. E&OE: The information contained herein was obtained from sources which we deem reliable, and while thought to be correct, is not guaranteed.
Kitsilano ADDRESS SALE DATE SALE PRICE UNITS OR LOT SIZE PRICE/ UNIT or LOT SIZE YEAR BUILT EGI CAP RATE 19 2050-2060 Alma Street & 3675 West 5th Avenue MU Mar-17 11,280,000 9,604 sf 1,175 1920-1978 Sold as Development Site 20 2225 West 8th Avenue May-17 18,500,000 47 393,617 1967 678,262 2.60% 21 2275 West 7th Avenue MF May-17 3,850,000 5 770,000 1910 108,277 2.23% 22 1609 Cypress Street SP Jun-17 9,580,000 16 598,750 1911 374,139 3.19% 23 2023 West 7th Avenue Jul-17 4,888,000 10 488,800 1959 128,900 1.95% 24 2200 West 5th Avenue Aug-17 5,400,000 7 771,429 1910 220,200 3.71% 25 1925 Maple Street Aug-17 5,200,000 10 520,000 1957 N/A N/A 26 2150 West 1st Avenue Sep-17 10,500,000 13 807,692 1965 403,175 3.43% 27 1526 Arbutus Street CO Sep-17 7,600,000 10 760,000 1949 N/A N/A 28 3536 West 1st Avenue MF Oct-17 3,250,000 7 464,286 1912 130,488 3.36% 29 1876 West Broadway SP Oct-17 12,125,000 6,250 sf 1,940 1927 Sold as a Development Site 30 2268 Cornwall Avenue Nov-17 7,400,000 11 672,727 1927 206,525 2.17% 31 1968 West 2nd Avenue SP OM Nov-17 14,300,000 24 595,833 1968 586,185 3.42% 32 2185 West 8th Avenue OM Nov-17 8,500,000 20 425,000 1966 N/A N/A CORNWALL AVENUE 30 27 22 28 26 31 ALMA STREET 19 WEST 4TH AVENUE WEST BROADWAY WEST 12TH AVENUE MCDONALD STREET 24 21 32 ARBUTUS STREET 25 23 20 29 BURRARD STREET GRANVILLE STREET 10 Development Site SP Share Purchase TH Townhouse MU Mixed-Use MF Multifamily OM Off Market CO Co-Op ST Strata HR High-Rise N/A Not Available Denotes Sales by JLL
Neighbourhood Breakdown Marpole TOTAL 2016 2017 11 TOTAL OF MEDIAN PRICE PER UNIT AVERAGE CAP RATE CMHC VACANCY RATE 13 86,348,000 338,462 2.86% 0.60% 5 21,750,000 355,000 2.50% 0.80% Sources: RealNet, Commercial Edge, CLS, BC Assessments, and information gained by JLL that we deem reliable. E&OE: The information contained herein was obtained from sources which we deem reliable, and while thought to be correct, is not guaranteed.
Marpole ADDRESS SALE DATE SALE PRICE UNITS OR LOT SIZE PRICE/ UNIT or LOT SIZE YEAR BUILT EGI CAP RATE 33 8680 Montcalm Street Jan-17 4,000,000 12 333,333 1958 119,580 2.14% 34 8668 Montcalm Street Jan-17 3,100,000 10 310,000 1958 N/A N/A 35 8691 Selkirk Street Jun-17 3,550,000 10 355,000 1958 111,840 2.04% 36 8638 Hudson Street Jul-17 3,800,000 10 380,000 1996 137,725 2.76% 37 8580 Oak Street OM Sep-17 7,300,000 17 429,412 1969 N/A 3.07% GRANVILLE STREET 34 33 WEST 70TH AVENUE 36 35 OAK STREET 37 SOUTH WEST MARINE DRIVE 12 Development Site SP Share Purchase TH Townhouse MU Mixed-Use MF Multifamily OM Off Market CO Co-Op ST Strata HR High-Rise N/A Not Available Denotes Sales by JLL
2017 Vancouver West Side Sales 1616 WEST BROADWAY Feb-17 9,500,000 Size 6,250 sf Built 1926 1550 WEST 11TH AVENUE 1,520 462,963 12,500,000 EGI 375,738 Cap 2.14% Units 27 Built 1965 1 OM 2 Mar-17 2777 OAK STREET May-17 21,500,000 Size 18,753 sf Built 1973 1546 WEST 12TH AVENUE 1,146 Jun-17 ST 4 541 WEST 13TH AVENUE Jun-17 4,900,000 Units 9 Built 1912 5 1686 WEST 12TH AVENUE 544,444 EGI N/A Cap 2.64% 475,375 22,818,000 EGI 667,625 Cap 1.83% Units 48 HR Built 1968 6 Jul-17 1569 WEST 12TH AVENUE Jul-17 7 Jul-17 9 Development Site SP Share Purchase Nov-17 TH Townhouse 4,996,500 Units 9 Built 1956 1385 WEST 15TH AVENUE 768,421 14,600,000 EGI 494,844 Cap 2.56% Units 19 HR Built 1965 MU Mixed-Use 555,167 EGI 137,202 Cap 1.96% 8 463,636 10,200,000 EGI 299,830 Cap 2.10% Units 22 Built 1945 13 525,000 EGI 130,209 Cap 1.71% 3819 CAMBIE STREET JLL SALE 1225 WEST 10TH AVENUE 5,250,000 Units 10 Built 1951 576,923 EGI 205,726 Cap 2.06% 7,500,000 Units 13 Built 1927 3 MF Multifamily 10 OM Off Market CO Co-Op ST Strata Nov-17 HR High-Rise N/A Not Available Denotes Sales by JLL
2017 Vancouver West Side Sales 3591 OAK STREET Dec-17 5850 VINE STREET 613,462 15,950,000 EGI N/A Cap N/A Units 26 CO Built 1947 11 Feb-17 8,230,000 Units 21 Built 1959 12 2346 WEST 43RD AVENUE Feb-17 4,400,000 Units 9 Built 1954 13 5815 YEW STREET 488,889 EGI 137,549 Cap 2.27% 481,928 40,000,000 EGI 1,500,000 Cap 2.69% Units 83 HR SP Built 1965 14 Mar-17 5410 BALSAM STREET JLL SALE May-17 15 Jun-17 Jun-17 26,000,000 Size 18,731 sf Built 1952 16 4,600,000 Units 10 Built 1958 17 460,000 EGI 131,323 Cap 1.99% Nov-17 Mar-17 11,280,000 Size 9,604 sf Built 1920-1978 14 Development Site SP Share Purchase TH Townhouse 1,175 MU MU Mixed-Use 393,617 18,500,000 EGI 678,262 Cap 2.60% Units 47 Built 1967 20 MF Multifamily 1,230 2225 WEST 8TH AVENUE 19 11,508,600 Size 9,360 sf Built 1956 18 2050-2060 ALMA ST & 3675 W 5TH AVE 1,388 6060 EAST BOULEVARD 2181 WEST 40TH AVENUE JLL SALE 6020 EAST BOULEVARD 469,697 15,500,000 EGI 552,625 Cap 2.43% Units 33 Built 1966 391,905 EGI N/A Cap 1.90% OM Off Market CO Co-Op ST Strata May-17 HR High-Rise N/A Not Available Denotes Sales by JLL
2017 Vancouver West Side Sales 2275 WEST 7TH AVENUE May-17 770,000 EGI 108,277 Cap 2.23% 3,850,000 Units 5 Built 1910 21 1609 CYPRESS STREET MF Jul-17 4,888,000 Units 10 Built 1959 23 Aug-17 488,800 EGI 128,900 Cap 1.95% Aug-17 5,200,000 Units 10 Built 1957 25 5,400,000 Units 7 Built 1910 24 2150 WEST 1ST AVENUE 520,000 EGI N/A Cap N/A 807,692 10,500,000 EGI 403,175 Cap 3.43% Units 13 Built 1965 26 Sep-17 1526 ARBUTUS STREET Sep-17 7,600,000 Units 10 Built 1949 27 760,000 EGI N/A Cap N/A CO Oct-17 Oct-17 12,125,000 Size 6,250 sf Built 1927 3,250,000 Units 7 Built 1912 28 15 Development Site SP Share Purchase TH Townhouse MF 2268 CORNWALL AVENUE 1,940 Nov-17 SP MU Mixed-Use 30 MF Multifamily OM Off Market CO Co-Op ST Strata HR High-Rise 672,727 EGI 206,525 Cap 2.17% 7,400,000 Units 11 Built 1927 29 464,286 EGI 130,488 Cap 3.36% 1876 WEST BROADWAY 3536 WEST 1ST AVENUE 771,429 EGI 220,200 Cap 3.71% SP 2200 WEST 5TH AVENUE JLL SALE 1925 MAPLE STREET 598,750 EGI 374,139 Cap 3.19% 9,580,000 Units 16 Built 1911 Jun-17 22 2023 WEST 7TH AVENUE N/A Not Available Denotes Sales by JLL
2017 Vancouver West Side Sales 1968 WEST 2ND AVENUE Nov-17 595,833 14,300,000 EGI 586,185 Cap 3.42% Units 24 OM SP Built 1968 31 2185 WEST 8TH AVENUE Nov-17 8,500,000 Units 20 Built 1966 32 8680 MONTCALM STREET Jan-17 4,000,000 Units 12 Built 1958 33 333,333 EGI 119,580 Cap 2.14% Jan-17 Jun-17 3,100,000 Units 10 Built 1958 34 3,550,000 Units 10 Built 1958 35 8638 HUON STREET 355,000 EGI 111,840 Cap 2.04% 310,000 EGI N/A Cap N/A 8691 SELKIRK STREET OM 8668 MONTCALM STREET 425,000 EGI N/A Cap N/A Jul-17 3,800,000 Units 10 Built 1996 36 380,000 EGI 137,725 Cap 2.76% 8580 OAK STREET Sep-17 7,300,000 Units 17 Built 1969 37 16 Development Site SP Share Purchase TH Townhouse 429,412 EGI N/A Cap 3.07% OM MU Mixed-Use MF Multifamily OM Off Market CO Co-Op ST Strata HR High-Rise N/A Not Available Denotes Sales by JLL