Valuation Archives

Our recipe: Valuing an apartment building

This article was written and published in the 2016 Year-End Goodman Report.

What goes into the mix when we decide what a building is worth? Here’s our stew:

Location: It’s not just about municipality. Neighbourhood, street, corner or midblock position – they all matter too. We get into the nitty-gritty, converting the property’s location into a quantified value.

Improvements/Condition: Any deferred maintenance? If the large items have been completed (think roof, piping, elevator, any structural requirements), then investors will view the property with greater pricing consideration. Is it a legal non-conforming structure, or does it conform? Any unauthorized suites?

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Purchasing a Multi-Family Rental Building: New Construction vs. Older Existing

Cynthia Jagger, Altus Group Limited
April 28th, 2014

There has been a lot of buzz in the Metro Vancouver real estate market regarding the construction of new rental apartment buildings and the sale of these assets on a forward looking basis.  Historically, this type of development has not “penciled out”, and when it has, it has been due to government programs, tax subsidies, etc.  The reasons behind why we are suddenly seeing this product entering the market are many and can form the basis for a subsequent article.  The purpose of this paper we will be to concentrate on some of the income and expense projection nuances between acquiring a new purpose built rental building vs. an older existing rental building.  As an example, “Why does the market demand a different capitalization rate when comparing these two types of income producing assets?”

Download the report here >>