TSX:AP.UN - Post Discussion
Post by
incomedreamer11 on Jan 29, 2024 8:56am
Scotia comments
Office. DT (+30bp) lagged Suburban (+10bp), in contrast to Q3/23, with DT and Suburban +88bp and +81bp in 2023, respectively. Edmonton jumped materially in Q4 (DT = +125bp; Suburban = +25bp), followed by Calgary (+50bp; +50bp); DT Winnipeg (+25bp); DT Montreal (+21bp); DT Halifax (+19bp); DT Toronto (~40% of AP; 77% of D) and DT Ottawa were each +17bp. Since 2022, DT private market cap rates are +165bp vs. +240bp and +246bp AP and D implied cap rate. As highlighted in our Q4/23 CBRE Office Stats update, new supply (as a % of inventory) is at the lowest level since 2017 and sub-let space appears to be stabilizing. However, higher Q4 office vacancy may limit AP and D’s ability to show occupancy gains in the near-term. We still believe that CAD Office REITs could perform well in a Soft Landing given the discounted valuation (for AP in particular).
Be the first to comment on this post