Real estate has been a core asset of the world’s wealthiest families and largest institutions since the beginning of time. Real estate houses the world’s businesses and provides shelter for the broader population. The appeal of real estate is based on the characteristics of the investment returns. There are three main sources of return from real estate: net rental income, debt reduction (as the mortgage is paid down), and growth in value as rental income and property values increase over time. Real estate tends to be a very stable asset class that delivers reliable rental income and tax-efficient long-term growth.
In 2018, average rents in the Victoria Census Metropolitan Area (CMA) increased 7.5% while the purpose-built rental apartment vacancy rates edged up to 1.2% from 0.7% in 2017 as the supply of rental units (construction completions) outpaced the increase in the demand for rental units. According to the 2016 Census and the 2011 National Household Survey, between 2011 and 2016, Victoria CMA added 9,340 households and of these household four of every five chose to rent instead of buy. A combination of stable employment prospects among younger age groups (who tend to be renters), the persistent gap between the cost of homeownership and renting, and population growth is expected to generate sustained demand for rental housing, resulting in below average long-term vacancy rates. Market demand, low financial costs in the current interest rate environment and favorable development policies for purpose-built rentals are supporting the construction of an expanded and updated rental stock in the Victoria CMA. (Source: “Housing Marketing Information.” Rental Market Report: Victoria CMA, Canada Mortgage and Housing Corporation, Fall 2018.) For these reasons, Alitis views the Greater Victoria area as a stable market.
Alitis is actively investing in the local market through partnerships with experienced developers and has projects that are in different stages of development including pre-construction (zoning or permitting), under construction, and buildings that are now completed and income producing.
Here are our current investments in the Victoria area:
Developer: Ironclad Developments | Location: Langford, BC | Type: 81 Unit Apartment Development | Completed: February 2018 Held in the Alitis Income & Growth Pool, Alitis Growth Pool & Alitis Private REIT
Developer: Ironclad Developments | Location: Langford, BC | Type: 106 Unit Apartment Development | Completed: March 2019 | Held in the Alitis Income & Growth Pool, Alitis Growth Pool, Alitis Private REIT & Alitis Private Real Estate Limited Partnership
Developer: Stride Properties | Location: Colwood, BC | Type: 48 Unit Apartment Development | Estimated Completion: July 2020 | Held in the Alitis Income & Growth Pool, Alitis Growth Pool & Alitis Private REIT & Alitis Real Estate Limited Partnership
Developer: Ironclad Developments| Location: Langford, BC | Type: 119 Unit Apartment Development | Estimated Completion: June 2020 | Held in the Alitis Income & Growth Pool
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