On November 5, I attended a Sauder event that involved Justin Bosa from Canaccord Genuity talking about real estate investment banking. Justin Bosa, a Sauder Grad of 1997, is currently the managing director of the real estate division at Canaccord Genuity, a global scale investment bank.

Mr. Bosa talked about the future of Canada’s real estate capital market, as well as the present prospering US market. One reason for the tremendous growth in the US market is due to the economy recovering from the economic recession. Similar rationale applies to the Australian market, which is the second fastest growing market.

The Canadian real estate market , on the other hand, has came to a stall as fears of rising interest rate has facilitated extensive sell-off of Canadian (and US) REITS. This led to Canaccord Genuity’s cut back on the target price of Canadian real estate investment trusts by as much as 5%.

REITS are securities that are traded in the stock market. They allow both big and small investors to own properties while enjoying high levels of liquidity in the investment.

In the same report, Canaccord Genuity has also predicted two likely scenarios while referring to the negative relationship between long-term bond yields and REITS valuation.

Link:

http://www.bnn.ca/News/2013/6/12/Canaccord-Genuity-cuts-REIT-target-prices.aspx