STATE OF THE MARKET
Across the Fraser Valley, the total number of development land sales between October 2019 and September 2020 declined 50%-60% compared to the 12 months prior. Surrey’s City Centre outperformed most areas in the number of properties that sold, however, the total dollar value of those transactions declined by a staggering 71%. As with other municipalities, this decline in total dollar value was largely driven by the broader market correction and the economic uncertainty created by the COVID-19 pandemic, which caused land values to decline and made purchasers of development land more cautious. As land values declined, the gap between buyer’s and seller’s expectations widened, making it difficult to find a meeting point on price.
Total Land Sales in Surrey City Centre
The City of Surrey is currently reviewing the City Centre Plan which includes re-evaluating the land use designations in the Central Business District (a small area surrounding the Sky Train between 104 Avenue and Old Yale Road). There has been speculation that a revised plan could mandate more office development in the Central Business District to increase jobs in the neighbourhood, but we will have to wait and see. The plan review also includes a broader reconsideration of densities throughout the entire town centre plan area which could see the value of the affected properties increase or decrease.
As the market rebounds from the pandemic-induced lull, confidence is building among developers and we are once again seeing interest in acquiring land in City Centre. It may be some time before land values rise, but the buyers are coming back.
The green highlighted regions on the below map indicate areas containing a high concentration of new development applications and are where we can expect to see new construction in the near future.
There are over 6,000 units of new housing under application in the highlighted areas of Surrey City Centre. The new homes are almost entirely condos and over half of the applications include a commercial component on the ground floor.
If you have any questions regarding development in Surrey City Centre, or if there is any further information that would be particularly helpful to you, don’t hesitate to contact Mike Harrison. To receive future reports directly to your inbox, please sign up for our development land newsletter here.
In creating this report we consult planning and engineering staff at the City of Surrey, survey multiple land transaction and new residential reporting systems (Commercial Edge, MLS, Urban Analytics New Home Source), and analyze municipal development data to bring you the most relevant information. This representation is based in whole or in part on data generated by the Fraser Valley Real Estate Board which assumes no responsibility for its accuracy.