The Fifth Dimension - Summer Edition 2021

WELCOME TO THE FIFTH DIMENSION

On the heels of two record-setting quarters, the new multifamily market in Metro Vancouver is as hot as the summer temperatures. The story outlined in this Summer Edition of the Fifth Dimension is a summer sales blockbuster. The teams at Fifth Avenue Real Estate Marketing Limited (Fifth Avenue) and Baker West Real Estate Incorporated (Baker West) certainly hope you enjoy the read as we aim to share and inform you of the market that is and is to come through 2021.

The supporting data for this report is objectively collected and presented by renowned Urban Analytics (UA) a leading provider of advisory services on the new multifamily home market. UA has been tracking the new multifamily home market in Metropolitan Vancouver since 1994 and has been a vital contributor to this report for over a decade.

Fifth Avenue is a full service, suburban market focussed, residential real estate sales and project marketing organization. We collaborate closely with our affiliate organization Baker West, who is focused on the central and highly densified core markets of Metro Vancouver including Downtown, Vancouver West, Vancouver East, Burnaby, Richmond and the North Shore. Fifth Avenue and Baker West are part of a growing ecosystem of premium real estate services companies operating throughout North America. In Canada, this includes Sotheby’s International Realty Canada; leading Toronto based pre-sale powerhouse Baker Real Estate Incorporated; luxury brokerage and Christie’s affiliate Chestnut Park; Okanagan based, EPIC Real Estate Solutions; and Greater Victoria’s The Condo Group Limited.

The times since the market doldrums of 2019 certainly have had their share of firsts for me. From a market perspective, this list includes back to back quarters of 6,000+ sales for the market area and an ever shortening summer pause. It seems more and more like when I worked in Asia, where the only time you could not conduct a sales launch was a couple of weeks in late Summer, Christmas and Chinese New Year.

These firsts also included something I never thought we’d be able to do or want to do – start sales of a new project successfully on the August Long Weekend. That happened too. The demand for homes in Surrey City Centre, Guildford Town Centre, and along the new SkyTrain corridor that recently received confirmation of federal government funding is something I have been public about for some time. The pace, however, at which demand has accelerated and pricing and absorptions increased was a first, east of the Alexander Fraser bridge, and South of the Fraser.

Another first for me has been turning 55. Funny how they call it “turning” a certain age. I suppose it can be that transformative. I do not recall being quite so introspective about my age and birthday since the year I turned 25. For some reason that was a tough one; this one was too. Back then I really questioned my path and what was next. I never thought it was an intensive career solely focussed on the development and promotion of real estate and people. 55 was a tough one too but not for questioning my path. The loss of a close friend and business partner and the more recent passing of my wife’s beloved mother, Alice Folk, certainly impacted my double nickel celebration. By the way, I call Alice that because the term “mother in law” sounds cold. Alice was never cold to me.

These firsts for me among others awoke the desire in me to be more present and vulnerable as a human; their lives and passings encouraged me to act with greater conviction and boldness each day and drilled home how short life is and all I have to be grateful for.

Speaking of gratitude, I start each day with a little exercise called 5G. I list in my journal five things I am grateful for that transpired in the past 24 hours. Many days I can get to five lightning fast; some days it takes work. When it comes to our work I am grateful for the folks at Fifth Avenue who show up everyday and engage in our craft and share themselves and their lives with each other. For instance, we have a chat called Our Home Team where we share ourselves to the extent we are comfortable. I have been inspired and encouraged countless times by the sharing including profound truths from our “quieter voices” in the firm.

I am also extremely grateful for each of our developer partner clients who put their trust in us. I am thankful for the partners at Baker West who have put themselves out there in the real estate style Olympic competition and their near immediate success listing over $1,000,000,000 in product and selling nearly $200,000,000 in sales since they started the business this past Spring. Given their success and focus, this is the First Edition of the Fifth Dimension that has been produced in collaboration with Baker West and Urban Analytics (UA). I am grateful for the team at UA.

Speaking of grateful, the older I get, the more grateful I am to be Canadian. I love Canada. I love British Columbia. I love Metro Vancouver. Of course, being grateful does not deny the wrongs of the past and the heavy lifting to come to set things right (#everychildmatters).

I am also grateful for the competitors and collaborators in the industry throughout BC. I believe in the Olympic ideal definition of competition. The notion that we press on to do our best and challenge each other to be and do better. Each of you working hard challenges me to be a better marketer, a better sales professional, a better leader, a good husband, a good Dad and a better man. I am grateful for you all.

So…what are you grateful for? Think about it.

Regards,

SB

W Scott Brown

President & CEO Fifth Avenue Real Estate Marketing LTD. scott@fifthave.ca

2 THE FIFTH DIMENSION SUMMER EDITION 2021

OVERALL MARKET SUMMARY

In this summer edition of the Fifth Dimension for 2021, Urban Analytics (UA), the data collection and analysis collaborator with suburban-focused Fifth Avenue Real Estate Marketing Limited, and Central Vancouver focused sibling company Baker West Real Estate Incorporated, shares its commentary on the most recent quarter, market performance year to date, and what to expect in the upcoming quarter with respect to Metro Vancouver’s multifamily residential real estate market.

Q2 — New Home Market

Metro Vancouver’s new home market continued its frenzied pace and achieved yet another quarter of strong sales for the Second Quarter of 2021. The total of 6,504 sales in Second Quarter was down by just 147 sales from the First Quarter of 2021, which was the highest recorded sales since the Fourth Quarter of 2018. This figure is down two percent from the previous quarter and is up 311 percent compared to the same quarter last year. There were 7,738 released and unsold units at the end of the Second Quarter which is up seven percent from the last quarter and is down 18 percent from the same quarter last year. There were 514 completed and unsold new multifamily homes available at the end of the Second Quarter, which is up from the 423 recorded last quarter and down 17 percent from the 620 recorded at the end of the same quarter last year.

A total of 2,966 new High Rise sales were recorded in the Second Quarter of 2021; down two percent from the last quarter and up 576 percent compared to the same quarter last year.

There were 5,376 released and unsold High Rise units available at the end of the Second Quarter; which is more than the 4,831 released and unsold High Rise units available last quarter. The Surrey / North Delta market recorded the highest number of High Rise sales in the Second Quarter of 2021. Notable sales activity occurred at Reliance’s 2 Burrard Place (West End), Concord Pacific’s Concord Metrotown (Metrotown), Ledingham McAllister’s Azure at Southgate City (Edmonds), Beedie Group’s The Heights on Austin (Central Coquitlam), Maple Leaf Homes’ Ascent (Surrey City Centre), and PCI Group’s King George Hub (Surrey City Centre).

New home sales in the Low Rise sector were very strong as 2,233 sales were recorded in the Second Quarter of 2021. This figure is up 40 percent from last quarter and up 415 percent when compared to the same quarter last year. The total of 1,375 released and unsold Low Rise condominium units at the end of the Second Quarter was up two percent compared to last quarter and down 43 percent from the same quarter last year. There were 24 new Low Rise condominium projects that launched in the Second Quarter, which is 16 more than last quarter and 23 more than the Second Quarter last year. Significant sales activity was reported at Apcon Developments’ The Hive (Yorkson), Zenterra’s Camden (Willoughby Heights), Mortise Construction’s Nova (Fleetwood), Tien Sher Properties’ Q5 (Surrey City Centre), and Belford Properties’ Dansey (Burquitlam).

A total of 1,305 new Townhome sales were reported in the Second Quarter of 2021, which represents an 84 percent increase compared to the same quarter last year and a 35 percent decrease compared to last quarter. There were 987 new released and unsold Townhome units at the end of the Second Quarter, which is 53 percent lower from the same quarter last year and 10 percent higher when compared to last quarter. Strong sales activity was recorded at Belford Properties’ Revive (South Cambie Corridor), Fabric Living’s Assembly (Hastings Corridor), Vesta Properties’ Latimer Heights Townhomes – Rooftop Patios (Phase 4) (Yorkson), Miracon’s Foundry (Yorkson), and Polygon Homes’ Archer Green (Mission).

Q2 — Resale Market

A total of 4,444 pre-owned multifamily homes sold in Second Quarter of 2021. This figure is up one percent from the previous quarter and is up by 115 percent compared to the same quarter last year. Resales across all product types have more than doubled when compared to the same quarter last year; re-sales of High Rise, Low Rise and Townhome product have increased by 124, 142 and 88 percent respectively. Overall active listings were down 30 percent compared to the same quarter last year. Active listings for newer product were down for High Rise, Low Rise, and Townhomes; by 15, 40, and 49 percent respectively when compared to the same quarter last year.

4 THE FIFTH DIMENSION SUMMER EDITION 2021

OVERALL MARKET SUMMARY - CONTINUED

Q2 — Observation and Opinions

The Second Quarter of 2021 has proved to be extremely active similarly to the first quarter of the year, particularly with an increase in demand for the Low Rise sector. With borrowing rates remaining low and working remotely becoming the new normal, homeowners are no longer anchored to the city they work in and are looking to invest in new home sales. Purchasers do not want to miss out on the current opportunities presented in the market and are taking advantage of low interest rates by investing into new developments that may not complete for a few years. The continued demand in the market is evident from the 6,504 new home sales recorded in Metro Vancouver for the Second Quarter of 2021, which is 2 percent down from the previous quarter and is up 311 percent compared to the same quarter last year. Steadily high demand has resulted in increased pricing from developers and is anticipated to continue as new projects launch and existing phased projects become released. There are 7,738 released and unsold units that remain at the end of the Second Quarter of 2021. This figure is a 7 percent increase from the previous quarter and is an 18 percent decrease from the same quarter last year.

In the Second Quarter of 2021, the Low Rise sector experienced the most notable increase in demand as new home sales were very strong at 2,233 sales recorded, a 40 percent increase from last quarter and a 415 percent increase from the same quarter last year. In the Second Quarter of 2021, 24 new Low Rise condominium projects were launched, which is 16 more than

last quarter. Demand remains strong despite a steady supply of project launches, and it is anticipated that pricing will continue to experience upward pressure as a result.

Significant projects anticipated to launch in the second half of 2021 include: Downtown Vancouver – Amacon’s Block; in Vancouver West – Aria Pacific Developments’ Savoy at QE Park and Integulf’s Lilibet; in Vancouver East – Nexst Properties’ Clive at Collingwood and Porte Homes’ Grafia; in Burnaby – Beedie Group’s Slate and Thind Properties’ Lumina (Eclipse); on the North Shore – Concert Properties’ North Harbour and Lotus Capital and Omicron’s Silva; in the Tri-Cities – Amacon’s Vue and Polygon Homes’ Balantree; in Richmond/South Delta – Townline and Canderel’s Luxe Lansdowne and Chen Developments’ Luxio on the Park; in South Surrey/White Rock – Streetside Developments’ The Boroughs; in Central Surrey/North Delta – Allure’s The Grand on King George and ML Emporio’s Oak & Onyx; in Langley/Cloverdale – RF Properties’ Eastleigh, Apcon Group’s The Hive (Phase 2), and Streetside Developments’ Emory; and in Abbotsford/Mission – Amacon’s McKenzie Mews; and in Ridge Meadows – Tridecca Developments’ Thomas.

HIGH RISE SALES

2,966

LOW RISE SALES

2,223

TOWNHOME SALES

1,305

New Home Aggregates Q2-2021

High Rise

Low Rise

Townhomes

Total

Total Q2-2021 Sales

2,966

2,223

1,305

6,504

Total Inventory

5,376

1,375

987

7,738

Standing Inventory

286

188

40

514

Total # of Projects

152

117

134

403

Sales Comparison Totals Q2-2021

YTD 2019 Sales

YTD 2020 Sales

YTD 2021 Sales

% Change from 2020

High Rise

1,895

1,452

6,004

413%

Low Rise

838

1,018

3,823

375%

Townhomes

741

1,438

3,328

231%

Total

3,474

3,908

13,155

337%

Resale Market Totals Q2 - 2021

High Rise

Low Rise

Townhomes

Total

Total Sales

1,483

1,464

1,497

4,444

Total Active Listings

1,247

587

503

2,337

5 THE FIFTH DIMENSION SUMMER EDITION 2021