Despite inflation rates holding steady as the year winds to a close, the real estate industry faces continued uncertainty as we head into 2024. Challenges include everything from financial insecurity to environmental changes to ongoing civil unrest. But the biggest challenge for many real estate owners will be finding affordable insurance coverage to protect their properties.

“Last year was one of the costliest years on record, with $275 billion in damages—and $3 billion in Canada alone.”

Reinsurance, otherwise known as insurance for insurers, is a critical factor in determining the cost and availability of coverage for commercial real estate. Throughout the past year, reinsurance costs have risen 25 to 30 per cent and capacity has fallen by roughly 20 per cent.

The changes in the reinsurance market have come about, in large part, because of losses related to global natural disasters. Last year was one of the costliest years on record, with $275 billion in damages—and $3 billion in Canada alone. Between the springtime derecho in Ontario and Quebec, summer storms in Western Canada, and the effects of Hurricane Fiona, weather events are causing more damage than ever before. In 2023, losses related to wildfires are expected to run between $700 million and $1.5 billion.

Insurance carriers buy reinsurance to protect themselves financially from major losses (like those from the wildfires). But when reinsurers raise their costs or limit capacity, the insurance carriers must take on more risk. As a result, they will raise their own rates, limit their exposure to risk through higher deductibles or lower the amount they’re willing to insure.

The bottom line: Real estate owners will be paying more for less coverage—and the situation isn’t likely to change anytime soon. Finding affordable insurance coverage for real estate owners will remain challenging for the foreseeable future.

Canada’s 25 most expensive small and medium-sized markets are concentrated in British Columbia, Ontario, and Quebec, with Greater Vancouver and Greater Toronto dominating the top rankings. Côte Saint-Luc in Quebec remained the fastest-growing market for apartment rents in October, with a remarkable 29.4 per cent annual increase.

Average asking rents for shared accommodations in British Columbia, Alberta, Ontario, and Quebec reached a record high of $960, growing by 16.2 per cent over the past year.

4 tips to protect your real estate investment

Although the out-of-control reinsurance market isn’t likely to improve, that doesn’t mean property owners should sit back and do nothing. Taking certain proactive steps will increase a property’s resilience and help building owners secure appropriate insurance coverage to protect them in the event of a catastrophe.

1.Keep your property in good repair.

With extreme weather events increasing in frequency, real estate owners and operators will need to take aggressive steps to manage their risk. Properties should be well maintained and secured with access control, surveillance, and intrusion detection. Those equipped with sump pumps and other protective devices to diminish damage from flood and fires will attract better pricing and a larger number of coverage options.  SEE THE NEXT SECTION RE LEAK AND FLOOD PREVENTION.

2.Check out the costs of reconstruction.

Insurance coverage simply can’t keep up with the ever-growing costs of rebuilding. Older or outdated policies no longer offer enough coverage to replace or reconstruct a building once it’s damaged, making carriers nervous. To avoid valuations that are too low or inaccurate, real estate owners should have their buildings appraised – and then include that appraisal along with an insurance application or renewal to avoid extra costs and penalties. Without this extra information, carriers may independently increase premiums when they deem it necessary.

3. Look into alternative coverages.

When a storm hits, many real estate owners and operators are concerned about their businesses as well as their buildings. A catastrophic weather event may not damage your building, but it could halt your business for a period of time. Consider securing a parametric policy, which pays out based on the size of the event, rather than the amount of loss suffered. This means you’ll receive a payout even if your building isn’t damaged, offering much-needed cash to cover business interruption costs.

4. Secure the right tools and supports.

In a risky environment, having trusted advisors to help you secure appropriate protection can be invaluable. Experts in the field have access to tools that can save on insurance costs, such as CAT modelling. They also know what has worked for other real estate owners and operators, such as splitting off less-desirable locations, placing coverage with multiple carriers or looking for hidden liabilities in property leases. The right advisor can suggest an appropriate course of action to secure suitable coverage for the best price.

Drew Fenton is the real estate practice leader for global insurance brokerage Hub International in Toronto.









We all know insurance rates for apartments are going up.  This is a global insurance industry situation.  But imagine the insurance company NOT insuring you due to historical claims re leak and floods or due to the age and condition of your building and the "potential" for leaks and floods.  Overt the past 25 years owners of apartment buildings have been upgrading suites on turnover to achieve higher rents.  In the early days it was just kitchen and bathroom upgrades.  Over time other things were added like in suite washers and dryers and in the end dishwashers as well.

Washers and Dishwasher must obtain water from a source (through a hose) and then dispense of the water through a drain.  Assuming all this is done according to code with a licensed plumber there generally is little concern of leak or flood at the start.  We also assume moving forward that the tenant will maintain and operate the machines according specifications.  This includes cleaning out traps.  This sometimes is a big assumption.  The issue is that if left unmaintained and even over time hoses will be compromised and problems not MAY but WILL occur.  If you these devices in your suites and they have not been looked at in say 10 years.  Problems are there waiting to happen.  We are seeing these happening now in our normal course of business and perhaps it has happened to you.

Our company is involved in "everything water" when it comes to multi family buildings.  We have developed a "Leak & Flood Monitoring, Detection , Prevention and Alert With Automatic Shut Off Solution and Burst Proof Hose" for these in suite machines.  This is technology that has been in use in Europe for many years.  In simple terms this is a new "AI" water supply hose that is highly durable and double line which highly minimized the chance of rupture.  It also has a device which measure the water pressure and flow and if it senses that a leak or rupture is happening it shuts off the water.  Thus preventing gallons and gallons of water flowing out everywhere.   There is another similar technology which can detect in real time flood events in elevator pits, mechanical rooms, pump rooms etc.

The goal with the above is to be pro active and preventative with regards to leak and flood events.  This will keep your insurance premiums down - reduce the changes of litigation - and give you peace of mind at a cost that is not much more then the cost of the old hose.  In addition to the above we have toilet leak monitoring devices as well.

We provide a service called the "In suite Fit Up" which can address many of your water issues and save you lots of money and improve the value of your buildings.

To find out more contact Nando Presciutti at 416-451-7838 or











COSTAR - Gary Marr

Apartment rents across the country reached another all-time high last month, according to a survey that tracks 35 Canadian markets. said the average asking rent reached $2,178 per month in December, an 8.6% increase from a year ago and just the latest new high in the market.

"The rate of rent growth in Canada was stronger than expected in 2023, mainly due to a surge in non-permanent residents, a resilient economy, and a sharp pullback in home buying activity," said Shaun Hildebrand, president of Urbanation, in a commentary. "While rents are expected to continue rising in 2024, there should be less upward pressure on the market this year as demand increases at a somewhat slower speed and more supply is added."

A TD Cowen report issued Tuesday said the company held a conference with 34 management team representatives from both public real estate investment trusts and real estate operating companies and select private companies and found the outlook for residential was among the top among all real estate asset classes.

"The outlook was especially positive for the Canadian residential and retail sectors where management continues to see very strong leasing fundamentals," according to the report authored by Sam Damiani, Jonathan Kelcher and Jaz Cumberbatch.

Under-Supplied Rental Market Expected To Become More Balanced in 2024, which produced the rental rate report with Urbanation, noted asking rents are up 22% over the past two years. Vancouver and Toronto are still the most expensive cities, with average monthly asking rents of $3,059 and $2,832, respectively, but rents in Calgary are rising at a faster rate than other cities.

While Toronto and Vancouver are seeing slowdowns in rental growth, Calgary posted the fastest annual rent growth for apartments in December, with rents rising 14% from a year ago to an average of $2,071. Edmonton was next at 13.5%.

The report said 2024 will continue to see an under-supplied rental market although somewhat more balanced. Nationally, the average apartment rent growth is projected to move to approximately 5%.

"Anticipated factors influencing the rental market in 2024 include a slowing economy, a reduction in the number of non-permanent residents, and an improvement in homebuying activity fueled by declining interest rates," according to the report. "The introduction of more apartment completions and an anticipated increase in tenant turnover are expected to inject additional supply into the market, mitigating rent growth compared to 2023."

A Statistics Canada report issued Tuesday said the rising rental market contributed to a 3.4% increase in the consumer price index in December from a year ago.

StatsCan said rent prices rose 7.7% in December year over year, following a 7.4% increase in November.

"Among other factors, a higher interest rate environment, which can create barriers to homeownership, put upward pressure on the index. While rent prices remained elevated on a year-over-year basis in most provinces in December, prices in Ontario (+6.9%), British Columbia (+8.6%) and Quebec (+6.8%) contributed the most to the increase," said the federal agency.




200 GARDEN STREET - OSHAWA - $11,950,000 / $213,400 PER SUITE

This is the sale of purpose built concrete rental apartment building with a total of 56 suites.  Built in 1973, this property is 4 stories in height and has a brick exterior, double windows, flat roof and balconies. The building sits on a large 1.93 acre site and rents were well below market.  There is surface parking only for around 80 cars.  Heating is HWG and hydro in separately metered and tenants pay for usage.  It has a good suite mix of mostly one and two bedroom suites with the average size being around 805 square feet.   This property was fully marketed and the buyer was a private investor.

164 MADISON AVENUE  - TORONTO - $4,850,000 / $267,500 PER SUITE / 3.25% CAP RATE

This is a 4 storey free standing house form rental apartment building and containing 22 suites most of which are bachelors.  Located in the prime Annex neighbourhood, this property is a wood frame building and is a walk up.  It has electric heating, brick exterior, double windows and mansard style roof.    The building had strong rental upside and suites were below average in size.  The property was fully marketed and sold to a private apartment investor.

3385 DUNDAS STREET WEST - TORONTO - $88,000,000 / $671,000 PER SUITE

This is the sale of a 131 suite new build rental apartment building in the west end. It is an 8 storey complex and contains one, two and three bedroom suites.  The project was constructed by Terra Firma homes and was 95% occupied at the time of sale.  The building is about 123,000 sf and this puts the sale price at around $700 psf.  The site is about 0.65 acres and there is surface and underground parking.  The property appears to not have been marketed and was purchased by the RealStar Group.

1689 VICTORIA PARK AVENUE  - TORONTO - $11,340,000 / $210,000 PER SUITE / 4.15% CAP RATE

This is a 4 storey free standing rental apartment building containing 54 suites on almost a one acre site.  Built in 1953, this concrete building is a walk up with no under ground parking - only surface parking.  It has a hot water gas fired heating system and rents include all utilities (except Hydro).  There is on site laundry and lockers.  The building has strong rental upside.  The property was fully marketed and sold to Greenpark.

2300 MARINE DRIVE  - OAKVILLE - $20,600,000 / $438,000 PER SUITE / 5.255 CAP RATE

This is the sale of a concrete rental apartment building which was constructed in 1983 and was owned by RealStar.  The asset was well maintained with one and two bedroom styles with many of them renovated and updated.  The site is almost 0.80 acres and average rents in the project were slightly below market.  Tenants pay their own hydro and the building included elevators.  There are 50 covered parking spaces and 15 surface spaces.  This is a superior asset and had air conditioning.   The property was sold to a private foreign investor that has about 1,000 suites here in the GTA.


Together the team has completed over 1,500 transactions and has sold over $7.0 billion in apartments and development land. Put us to work for you and see the results. NO ONE has sold more buildings than our group. Experience, knowledge and professionalism will insure you get the right deal or the highest price if you are selling.

The Apartment Group is a dedicated team of professionals specializing in the sale of multi-residential investment properties. With over 40 years of combined experience, the team brings together their strengths including strong negotiation and sales skills along with highly technical market analysis and appraisal methods.

We are a boutique Brokerage but have the capabilities of the larger houses without the overhead. We have: an internal database of over 10,500 active apartment and land Buyers; a list of all apartment building owners in the Greater Toronto Area; our web site gets over 50,000 hits a month; we highlight properties for sale through our newsletter which reaches 10,000 investors monthly.


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