With a mission to inform, empower, celebrate and advocate for British Columbia's current and aspiring business leaders, BCBusiness go behind the headlines and bring readers face to face with the key issues and people driving business in B.C.
Issue link: http://digital.canadawide.com/i/1512670
28 BC BU S I N E S S .C A J A N U A R Y 2 0 24 i S t o c k / w il d p i x e l Real estate: winter has come Even population growth, however, can't sustain the housing market in the face of today's elevated financing costs. "There's this growing segment of sellers who have variable-rate mortgages or higher fixed rates and they're getting uncomfortable," Berlin says. Investors are consolidating their property portfolios. Owner-occupi- ers are contemplating downsizing. More inventory is likely to come on the market just when prospective buyers are putting their plans on hold. For that reason, home prices will at best stagnate for the foreseeable future. Some housing types will do better than others. New migrants tend to live in apart- ments in cities and denser suburbs, Berlin notes. Luxury and recreational proper- ties, by contrast, will languish. And as long as prices stay flat or drift downward in the resale market, there will be little demand for developers' presale offerings. There's still a good amount of housing under construction, but once that's finished, there could be a long gap in the new housing pipeline. "The less expensive housing is where the activity is going to be focused," Berlin says. Labour relations: back to the old days Like an unwelcome ghost of Christmases past, labour unrest rose from the dead both at home and abroad in 2023. The strike at the Port of Vancouver disrupted an estimated $11 billion worth of trade, while the writers' and actors' strikes in Hollywood curtailed B.C. film and TV shoots. And our prognosticators expect the rocky relations between workers and employers to continue. Inflation and a tight job market, naturally, are driving higher wage demands that companies and public-sector entities are seldom in a position to satisfy. But also the pandemic destabilized the employment landscape, creating expectations among employees for more flexible work conditions that often conflict with employer priorities, notes GVBOT's Anderson. The only thing likely to quell the job action would be a steep rise in unemployment. E C O N O M I C O U T L O O K 2 0 2 4 W A L L F I N A N C I A L Wall Financial (TSX:WFC) could be the turnaround story among B.C. public companies in 2023. Against a difficult backdrop for real estate, the residential developer and hotel operator's stock had pulled off a nearly 50-percent bounce year-to-date as of late October. And this while paying its shareholders an eye-popping 15-percent-plus dividend yield. Too good to be true? Evaluating a company that develops buildings over many years is more complex than one that sells widgets and incurs expenses. This year should prove whether WFC's re- bound was justified or illusory. S I G M A L I T H I U M C O R P. Shares jumped 15 percent in September when Sigma Lithium (TSXV:SGML) revealed it had received multiple proposals from unnamed parties to buy the company, its Brazilian subsidiary or the mine it has been developing in that country (start-up was ex- pected in Q4 2023). Everyone from electric vehicle manufacturers to existing lithium suppliers has been scrambling to secure supplies of the essential battery element in expectation of soaring demand. Sigma, the No. 2 company on the TSX Venture Exchange by market capitalization, repre- sents a major new source of supply. T E L U S I N T E R N AT I O N A L Telus International (TSX:TIXT), the telecom's automated customer service spinoff, was the kind of tech company that investors craved up until the end of 2021. Then the tech backlash took hold amid rising inter- est rates. Plus, clients started cutting back on expenditures, such that 2023 full-year revenue guidance was cut from 10- to 12-percent growth to 1- to 2-percent. The stock cratered so badly, losing two thirds of its value, that it dragged the mother corp's shares down with it. TIXT vowed to cut 2,000 staff in response. But revenue continues to inch upward even now. This stock could feel the love again should earnings recover too.