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"CRE Matters" Columnists

Synthia Kloot Senior Vice President, Operations, Colliers International
Oliver Tighe Executive Managing Director, Commercial Appraisal Group, Colliers
Tanya Nicholson Director, Marketing, Landlord and Investment Sales, Colliers International
Madeleine Nicholls Managing Director, GTA, Colliers
David Bowden Vice Chairman, Head of Strategy and Consulting, Colliers Canada
Scott Bowden Head of Valuation & Advisory Services, Colliers Canada
Sarah Bramley and Amy Vuong Colliers International
Brendan Neeson Executive Director of Property Tax Services, Alberta, Colliers International
Lex Perry Vice President, Marketing, Communications and Research, Colliers Canada
Colliers National Multifamily Team, East, Colliers Colliers National Multifamily Team, East
Karl Innannen Managing Director, Broker, Colliers, Kitchener
Shiri Rosenberg Director of Asset Strategy, Innovation and Community Spaces, Colliers
Colin Alves & Jean-Marc Dube Colliers Toronto & Montreal
Janina Franceschutti Executive V-P, National Investment Services, Colliers Canada
Eric Horvath, CCIM Senior Vice President & Partner, Colliers
Adam Grisack Director, Valuation & Advisory Services, Colliers Canada
Eliezer Timolien Senior Research Analyst, Colliers
Robyn Baxter Senior Vice President & Co-Managing Director, Workplace Advisory, Colliers Canada
Arnold Fox Senior Vice President, Real Estate Broker, Montreal, Colliers
Alam Pirani Executive Managing Director, Colliers Hotels
Sarah Bramley Associate Vice President, Workplace Strategy & Innovation, Colliers
Bill Hennessey Managing Director, Moncton Brokerage, Colliers
Greg Taylor Managing Director, Halifax Brokerage, Colliers
Dayma Itamunoala Associate Vice President, Sales Representative, Toronto Brokerage, Colliers
Grant Evans Senior Vice President, Victoria Brokerage, Colliers
Lilian Kan Director, Development Management, Colliers Strategy & Consulting, Vancouver
Bonita Craig & Robyn Baxter Colliers Canada
Daniel Holmes President, Brokerage Services | Canada, Colliers
Sehaj Gill Associate Director, Property Tax Services, Colliers
Jane Domenico Senior Vice-President & National Lead, Retail Services
Robin McLuskie Managing Director, Canadian Hotel Brokerage, Colliers
Douglas Pulver Executive Managing Director, Colliers Vancouver
Tonya Lagrasta Head of ESG, Colliers Real Estate Management Services Canada
Pat Phillips Senior Vice President, Colliers Vancouver Brokerage
Rob Newman Senior Director of Property Tax Services, Colliers
Adam Jacobs Senior National Director, Research, Colliers Canada
Darrell Hurst Darrell Hurst, Senior Managing Director, Brokerage, Colliers
Jean-Marc Dubé and Arnold Fox Colliers Montreal
Robert Brazzell Managing Director, Ontario Property Tax Services, Colliers Canada
Damian Bernacik Director, Legal Services, Property Tax Services
Susan Thompson Associate Director of Research, Colliers Vancouver
Peter Garrigan, SIOR Executive Managing Director, Greater Toronto Area | Colliers Brokerage
Rob Purdy Executive Director, Colliers Canada’s Valuation and Advisory Services
Ryan McIver Senior Vice-President and Broker, Colliers Toronto


The value of prompt, accurate appraisals and how to make them count 

In today’s day and age where volatility seems to be the norm, the ability to provide comprehensiv...

In today’s day and age where volatility seems to be the norm, the ability to provide comprehensive information on a real estate asset in a speedy fashion has become crucial.

The current COVID-19 pandemic has pushed many people onto the sidelines, waiting to see how things unfold, and as a result there’s not nearly as much publicly available data as there used to be to make informed decisions about the value of an asset.

Diving into deep, first-hand market knowledge

Much of the activity that’s taking place in real estate today is being done by whispers and there’s a lot of confidentiality around that. It’s why knowledge, experience and expertise are critical.

Publicly available data is more and more rare.

Having a deep understanding of the market, listening and interacting with people so that you’re hearing the whispers of what’s going on, gives us a much better sense of the current reality and that is an advantage in a multi-disciplinary firm with appraisers who are deeply tied into their markets.

An example of how this really works comes from Matt Bruchkowsky in Colliers’ Toronto office, who recently helped a client with some multifamily properties. The client needed to accurately reflect what was happening during the pandemic to give their investors confidence.

Fortunately, Bruchkowsky had direct appraisal experience with more than 75 per cent of the last 50 sale transactions that the client wanted to rely on. He deeply understood those properties and as a result, could not only be accurate, but also support his client in maintaining that trust.

Maximizing technology for appraisals

During these times, it’s very risky to paint a property with a broad brush. Each is unique with its own set of circumstances that helps determine its value.

The technology that is used today has streamlined the administrative processes with writing an appraisal. It allows the industry to do an appraisal faster without sacrificing a thoughtful opinion of value.

We are also able to spend more time understanding clients and this is key for the industry, not only today but moving forward as well.

The less time spent playing with whether or not a report is falling within the margins of a page is more time spent actually taking a critical look at the market.

We have to understand what clients need the appraisal for and provide a better service experience because now we have more time to understand the property.

In today’s complex market, technology is the foundation to take care of the factors required to write an appraisal so that our experts can really do what they’re best at, which is provide a great service experience and provide a thoughtful conclusion.

Getting ahead of the trends

There are some key trends in real estate that are being impacted by the COVID reality.

Today, we’re experiencing an emergence of secondary asset classes.

One of our main appraisers, Oliver Tighe, is seeing an increased uncertainty around retail and office assets, and he is anticipating there will be a much bigger focus on properties such as student housing, self-storage and co-living style apartments as investors move away from what they might have traditionally invested in.

Most owners are still going to invest in commercial real estate, but we expect they will become more interested in secondary assets classes they previously would not have considered.

One of Colliers’ key retail experts, James Glen in Vancouver, sees a dramatic change to the sector, mostly in the form of the regional mall, which has historically been the ultimate form of shopping as entertainment.

Shopping and entertainment will come back after this COVID crisis, but in Glen’s words, the rate of attrition amongst various businesses – mostly fashion-oriented – means a trip to the mall is going to look very different five years from now.

Some mall sites are going to undergo a densification of their properties.

Some may undergo a partial or total conversion into alternative uses.

One shift that we see coming in the next five years is that many mall spaces could ultimately become quasi-warehouse spaces for online retailers like Amazon as they look at better “last-mile” delivery service.

An interesting current example we’re seeing is some malls providing a venue for people to come in and return products bought online. It’s almost like a post office, but the goal is to get people to come to the mall and while they’re there, to shop.

Traditionally, malls have used being an entertainment venue as that draw, but they’re going to have to come up with creative uses to continue drawing shoppers in the future.

Knowing one asset does not equal the other

In this current climate, it’s virtually impossible to paint any particular asset, or any particular geography, with a broad brush.

When times are good, or when things are moving in a uniform pattern, it’s easier to draw conclusions about which particular assets are doing well.

But, because the pandemic has opened up great opportunity in some categories and become quite a hurdle for others, the knee-jerk reaction to compartmentalize by assets is going to give false negatives or false positives.

No two pieces of real estate are the same and that uniqueness is critical in today’s climate.

You can’t just say “It’s a retail asset so here’s the risk rating with it.” You actually have to go into who’s in the building, how their industry is doing.

Doing so will give people a much better sense rather than trying to just take snippets of the news.

Accessing reliable, balanced information

The other aspect that is important is people need to be well-informed and balanced. There are many people reading news that confirms their own interpretation of what’s going on in the market.

And there are many people on polar-opposite ends of what they think is going to happen. If you’re only reading one side, then you’re going to be misinformed.

Information is key and people need to be working with people who are tied into the real estate market to get that balanced opinion.

In an age where there is so much conflicting information out there, it’s becoming more and more important for people to have a safe place where they can get an unbiased opinion.

There are many examples of how experts in our industry are being consulted to provide information about a property’s value.

Instances wherein our expertise is requested include when banks are facilitating a loan; when courts are settling a dispute; when people are appealing property taxes with the government; or when institutional clients are providing the value of their real estate to auditors.

Especially in today’s ever-changing world, it has become critical that accurate and timely information on valuations is supported by people with knowledge and experience, particularly in volatile and challenging markets.

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