“Napa North” real estate market returning to pre-recession levels and poised for growth with investment from Albertans, Generation Y and baby boomers
With the recently announced 186-unit apartment portfolio consisting of The Conservatory and the Lake Country Lofts hitting the market, there has been a lot of chatter about the future prospects of Kelowna and greater Okanagan real estate.
After taking a fair hit in the wake of the global financial crisis, Kelowna’s real estate market is back on an upward trend, with housing starts rising to 21.2% in 2013, surpassing the 1000-unit threshold for the first time since 2008. According to the British Columbia Real Estate Association (BCREA), Alberta’s thriving economy and skyrocketing housing prices are enticing Albertans to take advantage of Kelowna’s recreational lifestyle, which is a mere six-hour drive or a short, direct flight from Calgary, Edmonton and Fort McMurray. Currently, there is an estimated 5,000 to 7,000 workers from Northern Alberta who choose to commute from the Central Okanagan. Members of Generation Y looking to purchase a first home and baby boomers looking to buy a second are also now looking to buy in this beautiful city less than four hours west of Vancouver.
The home of two campuses, Okanagan College and University of British Columbia Okanagan, Kelowna accommodates more than 15,000 students each year – this significant student population, in turn, boosts the demand for rental housing.
And Kelowna’s upward trajectory is expected to continue. Already the third largest metropolitan area in British Columbia (and the 22nd largest in Canada), Kelowna is poised to see further population growth in all age groups over the next 20 to 25 years. According to Kelowna’s official community plan, by the year 2030, Generation Y and baby boomers will account for more than 50% of the city’s population. Consequently, housing stock will shift from single family units to multi-family units. To augment this trend is consumer demand, which has risen more than 12 percent annually for the past two years.
“With the expanding post-secondary sector and increasing employment opportunities within Kelowna, the city is a great spot for first-time homebuyers, renters and real estate investors,” says Curtis Scott, National Market Intelligence Analyst for Colliers International Canada. “Kelowna’s proximity to two major cities, Vancouver and Calgary, opens up opportunities for not only recreational real estate investment, but primary housing as well.”
The Conservatory and the Lake Country Lofts apartment portfolio provides an opportunity for a large player to enter the market in any number of ways according to Colliers International listing agent Jeff Hudson.
“We expect a significant player to make a move on these pretty quickly,” comments Hudson. “With the properties originally set up as strata developments, a savvy investor could take a hold position with an attractive rental return, look to develop on adjacent land, and/or split the units out and market them individually for a significant profit. The market is heating up and the vendor sees an opportunity to redeploy capital into another development opportunity, hence the opportunity we are presenting.”
Overlooking Kelowna Golf & Country Club, The Conservatory is five minutes from downtown Kelowna and Okanagan Lake, and is located on two of the areas’ major arterial routes, Glenmore Road and Summit Drive. Glenmore Road is a projected growth area supported by a future active transportation corridor.
The Lake Country Lofts are located minutes from Aspen Grove Golf Course, Wood Lake, and numerous restaurants and retail shopping centres. These units are also a mere 10 minutes from Kelowna International Airport and University of British Columbia Okanagan. The Lake Country Lofts are likewise situated in a future growth area where occupants of both new and existing multi-family units can benefit from commercial and employment opportunities, parks and recreation areas, and transit.
For more information on these investment opportunities, please contact Jeff Hudson or Marshall McAnerney at +1 250 763 2300.