June 2015 B.C. Economic Fundamentals

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#2
LNG forecast scenario

B.C. is preparing for the potential rise in natural gas activity related to proposed LNG projects. The Province, in conjunction with the BC Oil and Gas Commission, has developed this Natural Gas Production Forecast for LNG needs that provides a look at how activity levels could change if proposed LNG projects are approved.

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#3
Aquilini completes first downtown rental tower

Young tenants fed up with the half-century old, amenity-challenged apartments that make up 85% of Vancouver’s rental universe are expected to help Aquilini Development and Construction fill the first new rental apartment towers built in Vancouver in decades.

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#4
Top economist weighs in on B.C. issues

Interest rates, foreign ownership restrictions (or lack thereof), land-use policy and the effects of plunging oil prices are all these topics are on the minds of B.C. commercial real estate stakeholders.

Sherry Cooper is the chief economist at Dominion Lending Centres, Canada’s largest private mortgage and lending firm. Cooper, who is also a faculty member at the DeGroote School of Business at McMaster University in Hamilton, Ont., and the former executive vice-president and chief economist of BMO Financial Group, addressed these topics and more on in an interview.



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#5
UBC looks to micro suites to meet increasing demand for student housing

A soaring demand for student housing is prompting designers working with the University of British Columbia to cram a kitchen, study, bed and bathroom into a suite about half the size of the smallest space currently available to students.

The university is developing 43 145-square-foot microsuites for a new residence complex set to open in 2019.

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#6
'Hollywood North' heats up in Vancouver thanks to low Canadian dollar

The lower Canadian dollar is keeping the film industry in Vancouver busy with major Hollywood studios heading to Hollywood North to keep costs down by shooting in Canada.

In Vancouver, the film industry is operating at near-capacity with up to 40 big projects including the action movie Deadpool filming in the city last month, says Peter Leitch, president of North Shore Studios. Roughly 127,000 Canadians earn their living in the $6-billion film industry, and 2015 is expected to eclipse that figure.

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#7
Robust demand to push BC home sales higher this year

Housing demand across the province this year is expected to produce the highest level of unit sales since 2007. The alignment of economic growth, consumer confidence and rock-bottom mortgage interest rates is pushing home sales significantly higher. Multiple Listing Service® (MLS®) residential sales in British Columbia are forecast to rise 12 per cent to 94,300 units this year, after climbing 15 per cent to 84,000 in 2014, while MLS® residential sales are forecast to edge back nearly 3 per cent to 91,600 units in 2016. This will be the first year since 2007 that BC home sales will surpass the ten year average. A record 106,300 homes traded hands on the MLS® in BC during 2005.

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#8
With the dramatic slowdown in new energy projects in Alberta, the conjecture is that all of these workers will move to BC for energy jobs. But, frankly, there aren’t enough of those jobs in BC either. So watch for unemployment numbers to be skewed later in the year

Companies that service Alberta’s energy industry, battered by the oil market crash, are feeling the love in British Columbia.

Utility and logistics company Atco Ltd. and drilling- services provider Petrowest Corp. are among Alberta bidders on at least $45 billion of hydroelectric and liquefied natural gas projects in British Columbia set to start or be decided in 2015. Growth has slowed in Alberta, where some expansions in the oil sands are on hold because of depressed crude prices.

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#9
City of Abbotsford BC is reshaping their town for the future. Watch out Surrey, Abby is going for your #1 Spot!

As Abbotsford plans for its future, the focus will be on seven key concepts: create a city centre; establish distinct neighbourhoods; make walking, cycling and transit delightful; design places for people; foster natural beauty; enhance agricultural integrity; and, finally, make it work.

Those are the big ideas that came out of the second stage of Abbotsforward, the city’s official community plan (OCP) update, following community consultations that included more than 4,000 interactions with residents.

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#10
This proves once again that REIN is ahead of the curve. Avison Young releases new report on how public transit in Vancouver [positively impacts real estate prices

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#11
Blame physical limits, not foreigners, for Vancouver house prices

The math can’t lie. The city of Vancouver sits on 115 square km of the most beautiful land in the country; that hasn’t changed in more than a century and it’s not going to.

Yet, in the decade between 2001 and 2011, Vancouver’s population rose by 69,000 people; while the number of homes rose by just 28,000. Within the current 265,000-household total, only 47,000 are single-family homes of the sort coveted in the #donthave1million campaign.

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#12
Bogus 'analysis' obscures the role of foreign money in Vancouver's runaway housing market

If there’s one thing that should unite both sides of Vancouver’s debate about housing affordability and the role of foreign money in the real estate market, it’s the need for more data.

But apparently not everyone agrees. British Columbia’s housing minister, Rich Coleman, dismissed the idea of even tracking foreign ownership (let alone curtailing it) when it was raised in the provincial legislature last month. Housing prices in BC’s lower mainland were “pretty reasonable”, he helpfully added. Jaws were dropped. Eyebrows were raised.

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#13
Exxon Mobil has added a little more certainty to its LNG export proposal with news that it has selected on-shore terminal site plans near Prince Rupert.

Exxon Mobil has added a little more certainty to its LNG export proposal with news that it has selected on-shore terminal site plans near Prince Rupert.

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#14
More momentum for NE BC as pipeline gains approval

The Federal Government has approved the North Montney Mainline Pipeline that will connect the existing natural gas pipelines into a system so the gas can be sold into Alberta and the proposed Pacific Northwest LNG Terminal.

Minister of Natural Resources Greg Rickford, announced the decision Wednesday after reviewing the report from the National Energy Board. The NEB, recommend the project be built only if it met 45 conditions.

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#15
It is so easy to make the "unknown" the scapegoat. In this case the bandwagon seems rather full with those blaming the ' foreign investor' for Vancouver house prices, when in fact the majority of the price is geographic constraints, weather, economy and location.

A new report by the B.C. Real Estate Association says concerns over foreign buyers inflating house prices in Metro Vancouver are overblown and the real culprits are densification and geography.

"When we look at this idea that foreign investors are such a dominant force in the housing market that they're driving up housing prices and eroding affordability for first-time buyers, we find that there's no evidence of that," said Cameron Muir, chief economist with the BCREA.

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#16
Petronas LNG go-ahead seen as a good sign for other West Coast projects

A tentative green light for a multibillion-dollar liquefied natural gas project in British Columbia sets the stage for other players to follow suit, say energy industry experts.

Pacific NorthWest LNG “breaks some ground” for its peers by being the first B.C. LNG player to officially decide to go ahead, said ARC Financial vice-president Jackie Forrest.

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#17
Site C Dam project to break ground this summer

After 11 years of consultations, evaluations, negotiations and project planning work, BC Hydro’s Site C dam project on the Peace River in northeastern British Columbia will finally begin construction this July.

Despite this lengthy development process, the project is still just a little over halfway toward completion. Construction of the dam is expected to take an additional nine years, with the turbines finally beginning to produce power in 2024. And even that date might be optimistic. Despite receiving federal and provincial certifications in late 2014, BC Hydro is still seeking a number of land and water use permits and authorizations, and it is facing legal action from seven groups at both provincial and federal levels. Concerns raised in the lawsuits range from the project’s environmental impact to questions about whether another hydro project is the most economical way to produce electricity.

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#18
Wanted: A few nice rich people

"We’ve had some not-nice people looking at the penthouse,” Bruce Langereis said in a stage whisper during the elevator ride up to the unsold $18 million penthouse at the top of the Private Residences at Hotel Georgia.

Langereis, president of Delta Land Development Ltd., is on the hunt for a very specific kind of luxury condo buyer.

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#19
According to BCREA Foreign Buyers Have “Insignificant Impact” on Vancouver Housing Market. Frankly it is now all just guessing and conjecture as there are no real facts that can be compiled.

The skyrocketing demand for homes and rapid price acceleration is “largely driven by land scarcity and densification policies in the Metro region,” while foreign investment is “insufficient to impact such a large and diverse market,” according to a British Columbia Real Estate Association (BCREA) report published June 10.

The BCREA said that although there was a scarcity of data on the topic, the available information suggests that “foreign ownership of housing is considerably less than 5 per cent of the housing stock and not more than 5 per cent of sales activity.”


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Ally

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#20
Market implications of foreign buyers

Housing affordability has long been a thorn in the side of the Metro Vancouver story. Indeed, the rapid acceleration in home prices that occurred during the 2002-2008 period still has many people gobsmacked. Recent news stories have focused on the foreign buyer segment of the market, concluding that foreign investors are unduly inflating home values and driving potential domestic buyers out of the housing market, especially those looking to purchase their first home.

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