Star Phoenix, march 23, 2016 - A confluence of factors affecting Saskatoon’s rental market suggest the city could be on the verge of an “apartment renaissance,” according to a new report from Colliers International.
“I think renters are the beneficiaries,” said Colliers Saskatchewan president and managing director Tom McClocklin. “They’ve got more selection, they’ve got new buildings to look to, they’ve got re-lifed older buildings (and) higher vacancy means owners need to take care of renters.”
Between 1990 and 2008, the condominium conversion boom caused the number of rental units in the city to fall below 14,000 from a peak of about 19,000. However, an influx of about 1,000 new units plus an additional 1,000 student housing apartments over the last five years “increased the standard” for apartments in the city, according to Colliers’ first quarter 2016 multi-family market report.
At the same time, rising vacancy — economic uncertainty and reduced migration caused it to double, to 6.3 per cent, last year — and flatlining rental rates have led some property owners to re-invest in aging properties, the report states.
That’s all good news for renters, McClocklin said.
“Really, all of a sudden we’re going from people’s choices being pretty limited, pretty old to very modern, new, (high) quality,” he said, noting that while rental rates, which are flat for the first time in 26 years, may slow investment in older buildings, they represent an additional benefit to tenants.
One company that has poured money into aging Saskatoon apartment buildings is Block 1 Management Ltd. The property management company currently administers about 800 units spread across 11 buildings in the city, including the newly-overhauled Nutana Tower near Broadway Avenue and the Crossing complex on Idylwyld Drive North.
“I definitely think that there is an incentive to renovate in a market where there are vacancies,” said Rashida Bencherif, a project coordinator with the Saskatoon-based management firm. Saskatoon’s rental market has “experienced a shift” and there is a demand for high-end, modern apartments, she added.