Although Canadian institutional and private real estate investors think the market has yet to reach its lowest point, they are cautiously optimistic that a fast recovery is on the horizon and are honing their expansion strategies, says Colliers International’s 2010 Global Investor Sentiment Survey. Two out of three Canadian investors indicated they are considering further acquisitions over the next 12 months, mirroring the global trend.

The global survey of more than 240 major real estate investors (including 26 large Canadian institutional property investors) with a total investment portfolio of over $300 billion, also found a strong appetite for domestic investments. The vast majority (85 per cent) of Canadian respondents who indicated acquisition plans intend to focus on the domestic market, especially in locations such as Toronto (27.8 per cent), Vancouver and Montreal (16.7 per cent each), Edmonton and Calgary (14.8 per cent and 11.1 per cent respectively). The lack of appetite for foreign investments is also reflected globally with eight out of 10 respondents having no off-shore portfolio or intentions to invest overseas.

“On a risk adjusted basis, Canadian investors still see Canada as a preferred investment destination that offers a higher return on investment compared to the U.S., in part because of the turmoil that still lingers south of the border,” says Milton Lamb, chair, national investment team, with Colliers International in Canada. “Additional reasons respondents gave for focusing on domestic investments range from the quality of assets to diversification of income stream, availability of capital or better valuation matching income.”