Vanderhoof shares in B.C. mining potential

Nelson Bennett
Western Investor

About 450 full time jobs expected at just one of the new mines angling to open – if B.C.’s ‘sclerotic permitting system’ gets unclogged

Artemis Gold Blackwater site near Vanderhoof, B.C. | Artemis

About 450 full time jobs expected at just one of the new mines angling to open – if B.C.’s ‘sclerotic permitting system’ gets unclogged

Seven new mines could be built in B.C. in the coming years – an investment worth $4 billion that would generate 6,400 new construction and mining jobs.

But if the B.C. government wants those jobs, it needs to unclog its sclerotic permitting system, said Michael Goehring, president of the Mining Association of BC.

“Before any of these projects can proceed, and before the economic benefits can start flowing, they must be permitted by government,” Goehring said Wednesday in his annual address to the Greater Vancouver Board of Trade.

“I said this here two years ago and, unfortunately, I have to say it again.”

Goehring cited a couple of examples of new mines or mine expansions that are in the works. One is Artemis Gold Blackwater gold mine near Vanderhoof.

Artemis Gold bought Blackwater in August 2020 and plans to have project financing for work in the new mine by this fall. The production target is set for 2024.

“That project will boost the economy of B.C.’s central interior at a time when it desperately needs a boost,” Goehring said. “With this one mine, we’re talking 825 construction jobs for two years and up to 457 new jobs that will be created during operations.”

He added revenue sharing agreements with local First Nations would provide them with $200 million in benefits from the Blackwater mine.

Teck Resources is also planning an expansion of its Highland Valley Copper mine. The mine has only six years of life left. The expansion would extend it to 2040, Goehring said.

But B.C. risks a missed bonanza if it doesn’t fix its regulatory problems – a bonanza being driven in part by the global decarbonisation movement, which will require massive amounts of metals, like copper.

Copper prices are currently at an all-time high. And the demand for copper and dozens of other metals and minerals are expected to grow to meet the demand for new electric vehicles, batteries and renewable energy.

“Governments are making – or are poised to make – unprecedented investments in infrastructure and in clean tech,” Goering said. “And whether it’s copper for electric vehicles or metallurgical coal for the steel needed to build transit and bridges and wind turbines – we have it right here in BC.

“There is an urgency to make this happen. The time is now. This unique window of opportunity won’t be open for long.”

But high demand and prices for clean energy metals and minerals won’t necessarily translate into new mines being built in B.C. if the regulatory process is too onerous.

“Developing a new mining project in BC – or expanding an existing one – takes far too long and comes with too much uncertainty,” Goehring said. “Meanwhile increasing costs are hobbling our ability to compete in the world market.

“I simply can’t stress this enough. The permitting process in our province is too slow, too complex, and too costly.

“That said, we are encouraged and appreciative of the government’s ongoing review of the permitting process and look forward to an outcome that will lead to a permitting system that’s measured in months, not years.”

© 2021 Western Investor

National Bank’s Q2 results are in

Fergal McAlinden
Mortgage Broker News

 National Bank became the latest Big Six bank to release its Q2 financial results this week, reporting net income of $801 million for 2021’s second quarter – a 111% increase from the same period last year.

The bank said that its growth was fuelled by strong performances across the board, with increases in total revenues among most of its business segments and a significant reduction in provisions for credit losses.

That contrasted sharply with the second quarter of 2020, when provisions for credit losses had featured heavily in the bank’s results to reflect deteriorating macroeconomic conditions because of the pandemic.

Its net income for the six-month period up to April 30 was $1,562 million, an increase from $989 million in the same period in 2020. The bank also reported first-half diluted earnings per share of $4.40, an increase from $2.68 the same time last year.

Read next: National Bank sees double-digit net income growth

Before provisions for credit losses and income taxes, the bank’s income totalled $2,083 million for the six-month period ending on April 30, 2021. That represents a sizeable 19% year-over-year increase.

Louis Vachon, National Bank’s president and chief executive officer, said that Canada’s improving economic outlook had also laid the foundations for its “strong performance” in 2021’s second quarter.

“We continue to operate in an improving economic environment more conducive to business growth, with our Q1 momentum carrying over into Q2,” he said. “Our solid results once again reflect the fact that we have made the right strategic choices and have built a strong, diversified and agile franchise.”

Vachon added that the bank’s positive numbers were a good sign ahead of a possible post-pandemic recovery in Canada.

“With an industry-leading ROE, strong capital levels and prudent allowances for credit losses, we are well-positioned to selectively seize growth opportunities as we gradually exit the pandemic,” he said.

Copyright © 2021 Key Media

Six lot Langley land assembly sells for $6.53 million

Regent Park Realty Ltd.
Western Investor

The six single-family lots cover a total of 0.90 acres and were assembled for a potential high-density residential development.

Property type: Land assembly

Number of lots: 6

Location: 20120-20170 53rd Avenue, Langley, B.C.

Size of land: 39,385 square feet

Land size in acres: 0.90 acres

Zoning: Residential

Potential: RM3 (High-density residential to approx.. FSR1.7 or approx. 72 units)

Sale price: $6.53 million

Date of sale: April 14, 2021

Brokerage: Regent Park Realty Ltd., Vancouver

Broker: Suraj Rai

© 2021 Western Investor

North Van industrial site closes at $15.7M per acre

WI Staff
Western Investor

Largest North Vancouver industrial deal so far in 2021, $44 million sale includes four buildings and 2.79 acres with “phenomenal redevelopment potential”

Five North Vancouver industrial buildings sold for $44 million. | CBRE

Largest North Vancouver industrial deal so far in 2021, $44 million sale includes four buildings and 2.79 acres with “phenomenal redevelopment potential”

In the largest industrial real estate transaction on the North Shore so far in 2021, a 2.79-acre site with four contiguous buildings has sold for $44 million in North Vancouver City.

The deal closed on May 26.

The sold properties are at 945, 955, 961, 967 and 971 West 1st Street and have a combined size of approximately 1110,009 square feet. All of the space is currently leased.

North Vancouver has one of the lowest industrial vacancy rates in Canada, at 0.7 per cent, according to Matt Thomas, a principal at Avison Young, who acted as the seller’s agent in the transaction.

“This property features exceptional street exposure and is in proximity to several amenities including Capilano Mall, North Shore Auto Mall, and the newly-announced North Harbour development by Concert Properties,” Thomas noted.

CBRE vice-presidents Yashar Khalighi and Lawson Chu represented the buyer in the transaction.

Khalighi said the location, the size and the zoning of the properties makes them unique on the North Shore from an investment perspective.

The properties have holding income in place with strong tenancies and are under Special Industrial (M-3) zoning, which “offers phenomenal redevelopment potential,” Khalighi said.

 “The lack of new industrial supply over the past few years has severely impacted availability and vacancy rate levels. There is currently no new proposed supply for the near term for industrial product on the North Shore,” he added.

Metro Vancouver has the highest industrial lease rates in Canada, at an average of $13.87 per square foot, and North Vancouver has become one of the priciest markets.

“Much of the available [North Vancouver] industrial product is obsolete space as it was constructed in the 1960’s, 1970’s and 1980’s and warrants redevelopment. As a result, the asking net rent rates have reached levels on average around $18.00 per square foot , depending on the quality of product. Rates have netted over $20.00 per square foot on certain small bay quality industrial properties,” Chu said.

The price per-acre in the deal, at $15.7 million, eclipses the highest per-acre priced paid for Metro Vancouver industrial property in 2020, which was the $12.1 million per acre paid by developer Wesbild for a near five-acre site in the 8100 block of Manitoba Street in Vancouver last year, according to Avison Young data.

The recent previous highest price paid for North Vancouver industrial property was the $40.1 million paid by Nicola Wealth for a 4.3-acre site on Dollarton Highway in 2020.

© 2021 Western Investor

Owning a cottage is becoming a pipe dream, even for Canada’s wealthy

Bianca Bharti
other

Vacation spots only the ‘one per cent of the one-per-cent’ can afford

The seven-acre property listed for $24 million just outside of Port Carling is more a mansion compound than a cottage — with two lodges, a swimming pool, home theatre and tennis court — that overlooks 629 feet of Lake Muskoka. Photo by Supplied

The mayor of the Township of Muskoka Lakes, Ont., one of the country’s most popular summer retreats, said the property market in his town has become unsustainable after prices surged more than 70 per cent in the last year.

Phil Harding’s warning carries extra weight because he’s setting aside his own self interest to sound the alarm: Harding’s full-time job is a real estate agent.

“Personally, wearing two hats is a struggle because it’s nice to say to a client, ‘I’m going to get you as much money as I can,’” Harding said in an interview with Financial Post. “And I feel bad for somebody who has overpaid for a property who will struggle to get out of it” when the market cools.

Harding’s comments followed the  relisting of a Muskoka home for $24 million, which is easily the top five priciest listings ever for the region, he said. The seven-acre property just outside of Port Carling is more a mansion compound than a cottage — with two lodges, a swimming pool, home theatre and tennis court — that overlooks 629 feet of Lake Muskoka. It’s a vacation spot only the “one per cent of the one-per-cent” will be able to afford, said Harding.

Still, the listing has become yet another symbol of Canada’s frothy housing market in which housing prices nationally have surged more than 20 per cent since the start of the pandemic, the Bank of Canada reported.

I feel bad for somebody who has overpaid for a property who will struggle to get out of it

Township of Muskoka Lakes mayor Phil Harding

Sales in Muskoka increased 267 per cent in April from a year earlier, according to the Canadian Real Estate Association. The median price for waterfront properties, at the same time, rose more than 70 per cent to $890,000, although Harding said listings tend to begin above the $1-million mark.

The desire for waterfront properties grew among Canada’s wealthy as pandemic-induced isolation measures kicked in. Both Harding and Richard Scully, the agent selling the $24-million lakefront property, said it’s normal to have anywhere from five to 25 offers on a property. Cottages tend now to stay on the market for no more than 10 days, when it used to take 40 to 50 days to close a sale, Harding said.

Muskoka’s new waterfront owners collectively last month dropped $279.3 million to gain access to a lake view — a 354-per-cent increase from April 2020. Those high-rollers are now reshaping Muskoka living.

The pool at the Muskoka home listed for $24 million, a vacation spot only the “one per cent of the one-per-cent” will be able to afford. Photo by Chris Blair/Grizzly Media

The town, which typically hibernates in the winter after teeming with cottagers all summer, stayed active during the most recent offseason as businesses stayed open to serve residents who decided to wait out the pandemic at their vacation homes. Harding and Scully said fancy burger joints, lobsters at the local grocery store, and cottage helipads for private helicopters are becoming commonplace.

However, even as demand for Canada’s lakefront living grows, snagging a million-dollar property is increasingly becoming a pipe dream for even the richest, due to the lack of available land to build new properties and the small amount of inventory coming on the market.

Even the children of cottage owners cashing out on the land their parents bought 50 years ago for $1,000 aren’t listing on the market fast enough, Scully said.

A buyer would be “hard-pressed” to find more than two or three properties with 300 to 400 feet of lake frontage, he said.

“We talk about a lot of people looking for cottages (but) we don’t have much to show them,” Scully said. A cottage with even a 400-foot view of the lake is worth between $4 million and $9 million, he added.

“If you’ve got a million-and-a-half dollars and you want to buy a cottage, you’d think that would be enough but it isn’t,” Scully said. “It gets tougher and tougher to (buy) … each day that goes by.”

© 2021 Financial Post

BMO reveals latest financial results

Ephraim Vecina
Mortgage Broker News

 Robust gains and consistent growth characterized BMO Financial Group’s Q2 2021 performance, the bank reported today.

For the quarter ending April 30, 2021, BMO saw its net income reach $1.303 billion from $689 million during the same quarter last year, and net income of $2.095 billion from $715 million.

“Reported and adjusted net income increased from the prior year, driven by net revenue growth of 16%, higher expenses and lower provisions for credit losses,” the bank said.

Provisions for credit losses stood at just $60 million, compared to the $1.118 billion during Q2 2020. Return on equity was at 10.2%, from 5.3%, while adjusted ROE was 16.7% from 5.5%.

This strength stemmed from across-the-board increases in BMO’s operations.

“For the first half of the year, adjusted pre-provision pre-tax earnings of $5.5 billion increased 27% from a year ago, driven by revenue growth of 11% reflecting the benefits of our diversified business model, and very strong operating leverage,” said Darryl White, chief executive officer of BMO Financial Group.

Read more: Amid pandemic fears, the Big Six have ended up with massive excess capital

This substantial momentum is expected to carry the bank smoothly through the second half of the year.

“We are continuing to build a strong, competitive bank, allocating capital to businesses that are positioned to grow and deliver strong returns, and we are highly focused on continuously improving our performance,” White added. “Return on equity increased to 16.7%, we improved our efficiency ratio to 56.6% and strengthened our CET1 ratio to 13.0%, all underpinned by our strong balance sheet and differentiated risk and credit performance.”

White offered assurances that aside from consistently strong financials, BMO will be “delivering on our commitments for a sustainable future.”

“This quarter, we declared our ambition to be our clients’ lead partner in the transition to a net zero world and we are supporting key organizations that are helping reduce health care disparities, including global emergency COVID-19 relief efforts,” White said. “We are executing against a consistent, purpose-driven strategy – which for us means winning together with our customers, our communities, our employees and our shareholders.”

Copyright © 2021 Key Media

Stress test suddenly expands to all homebuyers

Frank O’Brien
Western Investor

 On May 21, just days before it comes into effect, the federal government has expanded its mortgage stress test to include all borrowers, not just those with more than a 20 per cent down payment.

Effective June 1, the stress test requires that all home buyers will have to qualify a five-year mortgage rate of 5.25 per cent, up from the current stress test level of 4.79 per cent.

In reality, even major lenders are offering five-year variable rate mortgages as low as 1.5 per cent. On May 26, HSBC was dangling a 0.99 per cent five-year variable mortgage, with some conditions.

Homebuyers don’t have to pay the stress test rate, just prove they are capable of paying it should mortgage rates increase sharply.

Still, the sudden change came as a shocker to the mortgage community.

“We did not expect that the new stress test changes would also apply to borrowers with less than a 20 per cent down payment,” said Vancouver mortgage broker Kyle Green of the Green Mortgage Team.

This stress test will reduce borrowing power by about 4 per cent to 4.5 per cent, Green noted.

The changes will affect the majority of borrowers in British Columbia because more than 80 per cent of mortgages funded in the province are uninsured, which means buyers have put down at least a fifth of the purchase price.

The stress test will apply to all mortgage applications received on or after June 1, 2021. In order to qualify at the current stress test payments, homebuyers need to have a live offer before June 1, 2021.

A pre-approved mortgage is not sufficient to avoid the stress test, Green noted.

Vancouver real estate investor and commentator Ozzie Jurock said the short notice of the stress test expansion would leave many insured buyers, including first-time buyers, scrambling to close before the June 1 deadline.

“Buyers who thought they had a mortgage may find they don’t have one,”Jurock told CKNW’s Money Talks radio show May 22.

Mortgage Professionals Canada (MPC) issued a statement to members May 21, noting it was disappointed that the finance minister decided to apply the stricter stress test to insured mortgages.

Noting that insured mortgages are normally held by young buyers, new immigrants, the recently separated, single parents and the financially challenged, all trying to purchase a principal residence, MPC said the stress test will hurt those most in need.

“Given the rapid rise in [home] prices, making qualification more stringent now will disqualify many of the Canadians the government has promised to support,” the association stated.

© Copyright 2020 Western Investor

Why your realtor may be making too much money

Tristin Hopper
other

Everything Should Be Better: Can you think of any other job that got a 100 per cent raise over the last 10 years?

 After a brief lull due to COVID-19, Canada has resumed its default condition of having an absolutely unhinged real estate market. This time around, some of the most meteoric growth has occurred in secondary markets, with price spikes of up to 20 per cent in a single year. So on that note, here’s a video about why real estate agents might be making too much money (or, at least, more than you expected).

Watch the latest Everything Should Be Better video or read the transcript below.

Oh hi there. If you’re watching this video in a part of Canada that speaks English, chances are good that the ground beneath your feet has spent the last couple of decades getting obscenely expensive.

There are a few reasons why this is not a great thing. First of all, it turns your major cities into unlivable hellscapes occupied only by the super-rich and anyone willing to raise their families in a glorified hamster cage. Also, when all of your national investment capital is constantly being poured into property, it doesn’t leave a lot left over for the stuff that actually makes economies grow, like innovation.

But I can tell you who does like a good generation-long housing bubble: Real estate agents.

Now don’t worry; I didn’t come here to bash realtors. One of them raised me, in fact. But before you sell your next house, here’s a few numbers to contemplate.

We’ll start with the obvious: Realtors are paid a percentage of every sale. Typically it’s seven per cent of the first $100,000 and three per cent of everything after that. With the commission usually being split between the buying and selling realtor, your realtor gets about 2.5 per cent of the sale price for selling your house.

In the last 10 years, Canadian average residential real estate prices have doubled. In hotter markets like Vancouver, prices have gone up more than 300 per cent since 2005. Can you think of any other job that got a 300 per cent raise over the last 15 years?

 Aside from this guy’s job, of course. Photo by Reuters/Michele Tantussi

Realtoring isn’t as easy as just showing houses to people: You’ve got office expenses, licensing considerations and all manner of whatever new paperwork the government has decided to throw at you. But, as with many things, the internet has made key parts of the job easier. A prospective buyer can now find your property, review its relevant details and even do a virtual walkthrough without your agent ever needing to pick up a phone.

Also, did I mention we’re in the midst of a crazy red hot real estate market right now?

When I sold my house in Edmonton a few years ago, my realtor had to flip a meh home in a not-great neighbourhood in the midst of a plummeting provincial economy. It was a months-long grind of showings, open houses and fruitless negotiations. Commission well spent, in my view.

But in Vancouver right now, the average property sells in 30 days. And oh look: This townhouse just sold for 30 per cent over its asking price. Far be it from me to say that, in certain markets, when buyers are literally throwing money at you, sales become a bit easier.

So why doesn’t anybody care? You have a profession collecting annual pay raises of up to 20 per cent for work that is staying about the same or getting easier. You would sure notice that kind of price differential at the grocery store, but people barely bat an eye at it when it comes to the real estate trade.

The reason is that, basically, when everybody is making crazy amounts of money for, just, owning land, you don’t get as concerned about the little details. When this is selling for $2.5 million, we’ve already thrown away the normal rules of economics, so yeah, $67,000 for two days’ work sounds about right.

This Vancouver house literally sold for $2.5 million; $100,000 over asking. 

So, screw the realtors: I’ll sell my own danged house. After all, I can turn it into a hotel room with Airbnb, so why can’t I sell it? You can: Services like Purplebricks will let you sell your home through an app for a flat fee, usually around $2,000. They’ll even put you on MLS! Quebec loves private sales: A single for-sale-by-owner website, DuProprio, is now responsible for 20 per cent of all Quebec real estate sales.

Why is Quebec much more open to private home sales? Probably because Quebec’s housing prices haven’t been nearly as insane as the rest of Canada. When you’re selling the family home for about the same price as you bought it, you become a bit more discerning about someone wanting to take five per cent of that.

Now don’t get me wrong: The occupation of real estate agent isn’t a scam. There’s plenty of folks every year who pay their realtor commissions with gratitude.

But if you’re handing five figures to someone who’s just going to post it on MLS and answer a few emails, you might want to consider whether an algorithm could do it just as well.

© 2021 National Post

North Shore home sales soar without foreign buyers

Jane Seyd
Western Investor

 Despite a near total lack of foreign buyers, North and West Vancouver home sales – and prices – have hit stratospheric levels: up to 60 houses sold for $5 million or more

— Broker Calvin Lindberg of Angel Hasman and Associates: locals dominate the market: Paul McGrath

Low interest rates, pent-up demand and a year of spending a lot of time at home have fuelled a spring real estate boom on the North Shore, say local real estate agents.

It’s a bit of an echo of the gold rush real estate market that had North Shore property owners selling for stratospheric prices five years ago.

One big difference this time around: it’s locals, rather than foreigners, who are doing the lion’s share of the buying.

“This time around was so different,” said Calvin Lindberg, with Angell Hasman and Associates in West Vancouver. “There was no offshore buying.”

Realtors were as surprised as anyone else by the bullish turn in the real estate market.

A year ago, real estate agents were worried

Last year, the impacts of the pandemic hit hard in the spring – what has traditionally been the busiest time in real estate sales.

“We were all pretty concerned,” said Lindberg. “Numbers were the worst we had seen in a number of years.”

Last June, however, that began to change, and starting in January 2021 the market roared back to life full force, ushering in “three months of craziness,” said Lindberg. “We moved into an incredibly busy time.”

Sales to listings shot up in both North and West Vancouver. With limited inventory and pent-up demand from buyers, prices also spiked between January and April.

The median selling price for a detached home in North Vancouver was $1.9 million in April, according to the Real Estate Board of Greater Vancouver – around 22 per cent higher than it was five years ago – while the median price in West Vancouver was $3.3 million.

Apartments in North Vancouver have been going for an average of $700,000.

Multiple offers

The seller’s market – particularly earlier this spring – prompted instances of multiple offers being made on properties and some homes selling for over asking price, said Aaron Rossetti of Re/Max Rossetti Realty in North Vancouver. One home in North Vancouver recently sold for $300,000 over the listing price, said Rossetti.

With more properties starting to be listed and buyers tiring of the competitive market, that trend is starting to cool, he added.

Most desirable homes are still being snapped up quickly, though, he said.

“Ones that are selling are selling within a week.”

Even the high end of the market – which took a hit when the foreign buyers tax was brought in in 2016 – has rebounded this spring.

“This year to date alone we’ve had 55 or 60 sales over $5 million in West Vancouver,” he said. Six of those sales were over $10 million.

Last year, seven waterfront properties sold in West Vancouver. But in the first four months of 2021, “we’ve already reached nine waterfront sales,” he said.

Most buyers are local people who’ve done well in business, he said.

Higher-end sales rebounding

Recent sales in the luxury real estate market include an 8,900-square-foot architecturally designed five-bedroom waterfront home that comes with a home theatre and a gym that sold for over $19 million in March. Another home, a 10,000-square-foot waterfront house at, sold for $18 million in March.

Dundarave and Altamont continue to be popular neighbourhoods, said Lindberg.

So is Edgemont Village. “Anything that comes on the market there is gone,” he said. “That whole area is incredibly popular.”

While the boom is now showing signs of cooling down from its height in March and April, agents are still busy.

Sales of condos and townhouses – which took a dip last year while buyers avoided communal spaces, including elevators – are also back, said Rossetti.

What’s selling now, said Rossetti, is “generally everything.”

© Copyright 2020 Western Investor

CanFirst expands Metro Vancouver industrial footprint

Wl Staff
Western Investor

Toronto industrial fund steps in with $104.5 million acquisition of 11 buildings in Surrey and Abbotsford

— Dozyn Dezyn Fraser Valley industrial portfolio covers three sites. | CanFirst

Toronto-based CanFirst Capital Management has made its first acquisition for its CanFirst Industrial Realty Fund VII with the purchase of an 11-building portfolio located in Surrey and Abbotsford, B.C.

The price for the Dozyn Dezyn properties, which cover three sites, was $104.5 million. The small-bay and mid-bay buildings are a combined 412,897 square feet and are completely leased.

The deal was announced on March 21.

The CanFirst Industrial Realty Fund VII closed in July 2020 after attracting $250.5 million, making it the largest fund ever raised by the company.

CanFirst purchased a portfolio in Surrey in 2019, its first acquisition there, and it’s now expanding its Metro Vancouver footprint, said CanFirst co-founder and chief executive officer Allan Perez.

“We like the metrics out there,” Perez told the Real Estate News Exchange. “The market is very, very tight and acquiring assets isn’t that easy to do. Similar to what we’re seeing here [in the Greater Toronto Area], there’s a very low vacancy rate and high demand.”

In fact, Metro Vancouver now has the lowest industrial vacancy rate in Canada, at 0.7 per cent, and the highest industrial lease rates in the country, according to first-quarter 2021 industry surveys.

© Copyright 2020 Western Investor