Sea to Sky Business Park by the Solterra Group of Companies in Squamish, BC has almost hit its first milestone. Building #2 is scheduled to commence construction in Summer of 2014 and Building 4 is now leasing with hopes of hitting its pre-lease target to move forward as well this summer. Both are planned for completion in Spring/Summer of 2015. 

BUILDING 2 – 60% LEASED!

Building 2 is a 15,820 square foot tilt-up concrete warehouse building comprised of nine approximately 1,750 square foot warehouse bays on the east perimeter of the Phase 1 site with visibility to Home Depot, Walmart and Toyota. 5 of 9 bays have been leased, which include a large climbing with 40 foot ceiling as an anchor and another fitness related business. This building is in close proximity to the 30,000 square foot indoor mountain bike facility that is in the works. 

BUILDING 4 – NOW LEASING

Building 4 is a 17,883 square foot tilt-up concrete warehouse building comprised of nine approximately 1,987 square foot warehouse bays on the west perimeter of the Phase 1 site with visibility to Ford and Toyota, fronting Queens Way, the primary local road through the Squamish Business Park connecting either end of town. 

The Sea to Sky Business Park is a 20 acre site strategically located 1 block off Highway 99, surrounded by anchors such as Walmart, Home Depot, Toyota and the new Ford location. Numerous other building supply retailers and prominent light industrial and manufacturing users are in the area. CN Rail is only 1 block to the west and the port facility is within a 5 minute drive with rail access from the Business Park.

The Sea to Sky Business Park offers tilt-up concrete warehouse and industrial space designed for light industrial retail, manufacturing and distribution, warehousing, and outdoor recreation/fitness facilities. There is an abundance of varying bay sizes from 1,500 to over 36,000 square feet with different price options and locations appropriate to different users. There is also an 8 acre section of land available for build to suit lease and sale opportunities to meet those needs not met in the basic spec buildings offered.

Call for more information.

The short is almost always YES!

Many people never even give consideration to the fact that commercial and residential real estate are 2 very difference professions, with very little in common aside from the Realtor designation that shows up on their business card.

It is not uncommon when someone has a commercial real estate need to pick up the phone and call the residential real estate specialist who most recently helped them with a home sale or purchase. Sometimes that agent will say “I can send you to a great commercial agent”, and in many cases they’ll say “sure I can help you with that”. When making a decision on who to choose to assist you in a commercial real estate search, acquisition or sale, it is very important that you assess that service provider to ensure they have both the professional expertise and experience to provide you the guidance and information that you require to make an educated decision that serves your best interests.

Alternatively, many business owners feel that if they conduct their own property search that they will be able negotiate a better deal for themselves dealing directly with the landlord. This approach may put you at the Landlord’s mercy.

Let’s Look at It from the Tenant Perspective:

Commercial real estate is a broad market segment covering business facilities for office, retail, civic and industrial users that all have unique nuances that can significantly impact the costs of tenancy/ownership, start-up costs, ongoing operating costs, legal, insurance and environmental issues in addition to building issues such as: power, communication, structure, specialized plumbing, loading, zoning and fire code. 

Any of the above items can impact the financial and operating feasibility of a space for a given business and can result in very negative consequences for a tenant if they are misinformed or under-informed. Unlike residential real estate, commercial real estate is not as highly regulated and very much operates on a buyer beware basis from a legal stand point >>>> if a tenant makes a commitment due to misinformation or error, they are not protected the same way as they would be by the residential tenancy act. They are on the hook for the rent and terms negotiated in the lease agreement. Commercial lease agreements are onerous and comprehensive and it is very important that an offer to lease has covered off the appropriate high level terms required for a tenant’s needs prior to their lawyer’s review of the final lease agreement. This requires years of experience and dozens if not hundreds of transactions to become competent in managing.

Information regarding commercial lease rates, operating costs and sales is also much more difficult to find. Most transaction are private and both landlords and tenants want to keep it that way. Building operating costs (in additional rent) vary from building to building, between property types, and different circumstances and in many cases a landlord may ask for a higher amount from a tenant than could be deemed reasonable by market standards. Any Realtor can go online and see what is available on the listing service and what the asking rates are, but the real information that matters will not necessarily be available publicly. Much of, or the most suitable commercial real estate inventory may not even be advertised online and the best suited space for a tenant may be available in a building with an upcoming tenant vacancy or renewal. 

Due to the extensive variable in types of space and circumstances, every commercial real estate deal is different. The end story is if you want to pay no more than market rent and get the most suitable space for your business you need to work with someone who is not only an expert in the field but also in the geographic area where you are doing business. 

Here are a couple of great early screening questions before you commit to a Realtor:

1. How many lease transactions have you performed in the last 3 months?
2. What are lease rates doing in product types x, y, z in area a, b, c?
3. Do you have any tenant references that you can provide?
4. What do triple net and op costs look like in these areas and building types?

If you cannot get quick answers to these questions………RUN.

10 Acre Equestrian, Estate or Recreational Lots from $899,000

Baynes Island Estates has significantly reduced pricing on its first lot(s) to sell now! 

Baynes Island Estates is a 7 lot bare land strata with lots from 10-14 at the west end of Depot Road in sunny Brackendale, BC (1050 Depot Road) within the municipal boundaries of Squamish. The area is known for eagle viewing, fishing, paddling and general outdoor recreation in a laid back setting, only 50 minutes from downtown Vancouver and 35 minutes to Whistler. Shopping and dining within 5 minutes.

The site is accessible via a private bridge and road that crosses the Judd Slough waterway on the east border of the property and is bordered on the west property line by the Squamish River and dyke. The site is virtually an island with water on 3 sides.

All sites are treed with road access, hydro, gas & communication and all lots offer panoramic views of the surrounding mountains and the 2 provincial park reserves across the river to the west; Baynes Island Ecological Reserve and Brackendale Eagles Provincial Park. The confluence of the Mamquam and the Squamish River is a short distance to the north of the property. This 80 acre sanctuary offers one of the most unique estate lot opportunities in the Lower Mainland. Rural 2 zoning allows for residential (2 dwellings), equestrian, bed & breakfast, agricultural and other uses.

Lots will be ready for buyers to build their dream properties as early as mid-June 2014. There is truly nothing like this in the Lower Mainland. Total privacy and serenity in commuting distance to downtown Vancouver.

Call to book a site tour or receive more information.

Darren McCartney

604-892-4875

Darren.mc@shaw.ca

www.squamishcommercialproperty.com

Investing in residential real estate has some distinct differences from investing in commercial property. Generally speaking commercial real estate investments deliver higher financial yields but there are some caveats to consider that can rule out many investors.

Financial Considerations

• Commercial real estate can frequently yield from 6-10% where a residential investment may only yield 2-4% in an area like the Lower Mainland of Vancouver. 
• A residential property collects market rent and deducts the expenses with the landlord assuming the risk and responsibility of ownership costs; whereas commercial income property usually have triple net leases where there is a stipulated basic rental amount or net income yield on an annual basis and all or virtually all operating and ownership costs with the exception of interest and taxes are passed on to the tenant. This structure ensures that any fluctuations in ownership costs are borne by the tenant and results in a much more efficient and stable investment over time.
• Residential income property usually requires a minimum of 20% down and commercial property usually requires 30%  + down 
• Although commercial rental yields are higher the cost of borrowing to purchase commercial property is usually at least 1.5-3.0% higher than the prevailing residential mortgage rates to compensate for some of the higher risks in income and liability involved in commercial ownership 
• Commercial properties typically sit vacant for a longer time period than residential properties but longer lease terms tend to compensate for the difference in cash flow over time for those who can weather the gap
• The last 3 items tend to limit the amount of commercial property investors to higher net worth individuals

Legal & Administrative Considerations

• The Residential Tenancy Act provides a huge amount of protection for residential tenants and enforce conditions that can be very onerous on a landlord that can result in unpaid rent for landlord debt service and being stuck with a deadbeat tenant for months on end with no ability to re-let the space
• Commercial tenancies are governed by contract law and entirely negotiable. These are business contracts.
• Commercial lease agreements are generally for multiple years and if tenants move on the onus is frequently on the tenant to find a replacement if they leave before the lease term.
• Rent is dictated by the market and negotiation and there are no rules in place in regards to annual increases; rent is based on supply and demand.
• The nature of the commercial real estate industry is such that lease agreements are much more protective of the landlord’s real estate asset and interests than a tenant’s, a polar opposite to residential tenancies

Commercial property ownership and management is much more complex than residential investing for several reasons:

• more extensive legal knowledge required in lease terms and negotiation
• more complex and costly repairs and operating expenses to manage and fund in owning commercial                 properties
• numerous variables to consider in assessing different property types to purchase and their long term potential and how to extract maximum value over time 
• more detailed and time consuming property management and accounting 

Other Considerations

• Residential real estate is much more familiar to us all in what tenants need and want, how the facilities and their maintenance and management
• Residential rental income, expense and asset values are readily available in abundance 
• Residential real estate is almost always more liquid in the event of a required sale
• In contrast there are a great many factors that can impact commercial properties existing and potential income, cost of ownership and liquidity and a professional appraisal is almost always required to determine real value given the lack of public information
• The wide range of commercial property segments and sub categories can be intimidating to a new commercial investor
• Residential property can frequently require more management due to higher tenant turnover and leaner budgets that do not always provide for professional property management
• Although more onerous in management sophistication, a commercial property owner can typically charge their professional management costs right down to their accounting back to the tenant 
• Residential tenants rarely treat a rental like their own which can result in more frequent repairs and maintenance eroding rental returns
• A business owner leasing commercial property is most frequently responsible for internal maintenance and repairs at the risk of their damage deposit and in many cases takes a level of pride and ownership in their place of business in order to project a positive image of their business to customers, colleagues and other business associates.

Astute investments in Commercial Real Estate can result in big wins just as easy as one bad step can have severe consequences to an investor. If an investor surrounds themselves with a solid advisory team including a qualified commercial realtor their chances of success are far greater.