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It’s no surprise that Western Investor recently highlighted Nanaimo as a standout location for real estate investment. With strategic infrastructure developments, booming commercial projects, and a high demand for rental properties, Nanaimo is primed for growth, making it an increasingly attractive destination for investors seeking long-term returns. As leaders in Nanaimo Real Estate and 30 years Experience we want to share our recommended picks and best areas for growth in Nanaimo
Secondary markets have been in focus over the past year thanks to high cap rates that have made more sense in the current financing environment. While interest rates are starting to come down, heralding a compression in rates, the shift will take time to work through the market. Meanwhile, an influx of people and businesses to secondary markets continues as high real estate costs send both investors and tenants looking for more affordable opportunities.
While there are plenty of towns that could qualify as prime secondary markets—the Southern Okanagan among them—the major moves are happening in hub cities on the fringes of major metropolitan areas. In B.C., this includes Nanaimo and Chilliwack, satellites to Vancouver.
In the Prairies, Calgary is the destination of choice for the influx of migration to Alberta and that’s driving investment in surrounding communities. The strong growth prospects for Alberta mean the opportunities have room to run.
But investment, while often framed in terms of residential properties, is also returning to commercial and industrial assets. Lethbridge is a case in point, but further east, Saskatoon and Winnipeg are reaping significant benefits from industrial investments. Residential markets north of Saskatoon are expanding in step with BHP Billiton’s plans for the world’s largest potash mine at Jansen, while CentrePort Canada is seeing renewed investment from industrial players in the Rural Municipality of Rosser thanks to its strategic location and transportation connections.
While many of these centres have been top towns in the past, the current combination of falling interest rates and normalizing conditions for business activity position them well for growth.
Nanaimo
Proximity to Vancouver has long made Nanaimo a favoured destination for value-minded buyers. While significant investment in civic infrastructure downtown has created hassles for residents over the past couple of years, the improvements prime the city for long-term growth driven both by students at Vancouver Island University and new commercial development such as Seacliff Properties’ massive Sandstone development north of downtown projected to have 2,200 residential units and up to three million square feet of industrial space.
Being a strategically located secondary market, Nanaimo has been a popular destination for multi-family investors as well as retail landlords. This year saw four multi-family properties in the city trade during the first six months, one more than in all of 2023, with three additional offerings in WestUrban’s portfolio coming to market in the second half of the year. Marcus & Millichap sold Metral Station, a fully leased retail centre anchored by Starbucks, Trail Appliances and Browns Social House that sold in September following multiple offers for the full asking price of nearly $15.9 million. “Originally owned by a Vancouver-based investor, it was ultimately purchased by a buyer from the B.C. Interior, highlighting the diverse interest from various buyer groups across British Columbia,” Marcus & Millichap reported.
Despite the consistently high level of attention Nanaimo receives, just 21 per cent of local residential properties are investor-owned, below the B.C. average of nearly 23 per cent. This points to ongoing opportunities for the foreseeable future as the city’s growth continues.
Western Investor. (n.d.). Beyond Vancouver: B.C.’s secondary real estate markets poised for investor growth. Western Investor. Retrieved from https://www.westerninvestor.com/real-estate/beyond-vancouver-bcs-secondary-real-estate-markets-poised-for-investor-growth-9741689