Case Study: Fraser Valley Purpose-Built Rental

Examining a multi-family development property in South Surrey, as a potential purpose-built rental site.

Property information

  • 15436 31 Avenue, Surrey
  • Located in the Rosemary Heights neighbourhood of South Surrey
  • 1.427 acre site
  • Development permit ready for 86 condominium units
  • Backs onto greenbelt with park-like setting
  • Designated live and work in official community plan


What we noticed when developing the proforma is that there is approximately a 30% differential between the rental rates that CMHC quotes for rental apartments and what renters are willing to pay to rent new product – and that difference jumps to over 50% when you isolate just two bedroom suites.

Developers and their financiers tend to use the CMHC rates in their proformas. This differential shows up as a gross underestimation of revenue and when translated to the residual land value, can make a great investment opportunity appear unfeasible.

This differential is likely a key reason why we see so few purpose-built rentals being built in the Fraser Valley despite a sub 2% vacancy rate.



Market rental rate data was collected in October and November 2015 from:
Hugh McKinnon Realty
Homelife Peninsula Property Management
The CMHC data is taken directly from the following reports:
CMHC Rental Market Statistics Spring 2015
CMHC Rental Market Report Vancouver and Abbotsford-Mission CMAs Fall 2014 (most up to date data set available)

Justin Mitchell

Personal Real Estate Corporation

Founding Partner
Residential Development Land
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