The Canadian economy may be a tad lacklustre at the moment, but a recent report from Sotheby’s International Realty Canada suggests that the luxury real estate market is on fire, particularly in Vancouver and Toronto.
Many people believe that the astronomical price gains seen in top-tier housing markets are a house of cards, poised for a spectacular tumble. That’s clearly not the opinion of Brad Henderson, the newly appointed president and CEO of Sotheby’s International Realty Canada.
One of the leading luxury real estate companies in the world, Sotheby’s is a rarefied brand, catering to high net worth individuals, including luminaries such as Celine Dion (whose stone mansion complete with helipad on a private island near Laval, Que. – asking price $25.5 million – was recently sold through Sotheby’s).
Following the company’s recent spring outlook report, Henderson confirmed that the company is continuing to see steep price increases in the luxury markets in Toronto and Vancouver, where the strongest volume increases last year were in real estate sales over $4 million. Montreal saw modest gains in its top tier market. But in Calgary the market is slowing due to the impact of declining oil prices.
In response to ongoing speculation about whether prices in the luxury market can continue to rise, Henderson says that Sotheby’s Canada, which currently has 400 agents and offices in over 30 residential and resort markets across the country, “has experienced year-over-year growth since coming into the market in 2005” and is not expecting that to slow down any time soon.
Henderson says he does not think an interest rate increase would have much of an impact on the real estate market, particularly the small bump-up that is anticipated in Canada. Not that that’s something a Sotheby’s client – many of whom own multiple properties and buy them outright with cash – would necessarily have to worry about.
“I’m delighted to be with Sotheby’s International Realty Canada. I’m more excited than I’ve been in my life about a job,” says Henderson. “Sotheby’s is one of the best known brands in the world and has attracted top real estate advisors as well as buyers and sellers of some of Canada’s most prestigious properties.”
He says he has been brought on board to help “expand the company’s footprint” in both new and existing Canadian markets. But for now, the specifics of the expansion plans are “a corporate secret,” he says.
Anecdotes about Sotheby’s internationally famous clients past and present are also a topic Henderson keeps close to his chest. You aren’t likely, for instance, to pry any information out of him about notorious U.S. presidential hopeful Donald Trump.
“We deal with celebrities, sports figures, business personalities. They all have one thing in common and that is that they don’t like publicity,” Henderson says.
With more than 30 years of diverse business experience, Henderson has undoubtedly kept his share of corporate secrets. Before joining Sotheby’s he was senior managing regional director for CBRE Limited in Canada and the North Central United States, where he oversaw a team of 1,200. He has also held senior executive roles at Colliers International and Royal LePage and has worked in the telecom and technology sectors, with executive roles at Telus and Gibraltar Solutions.
Born and raised in Toronto, Henderson has a degree in economics from York University. Upon graduation he was unsure what to do next. He’d enjoyed working as a summer student with Royal LePage and so accepted the company’s offer of a full-time position. Eventually he became operations manager and then vice president and general manager of the Greater Toronto Area, which is how he got his start along the executive path.
When offered the position with Sotheby’s Canada, one of the biggest lures for Henderson was the fact that Dundee Corporation – a public Canadian independent holding company – owns the franchise rights for Canada.
This sweetened the job offer for him, as he views Dundee as “a unique entrepreneurial company” and “a significant player in wealth management.” He liked the idea of Sotheby’s Canada being “an integral part of it” rather than being run as a collection of individual businesses.
“It’s unique in the real estate world in that all the offices are owned by one entity, so it acts like a unified corporation instead of having all offices owned by different people,” Henderson says. In his opinion, this sets Sotheby’s International Realty Canada apart from more mainstream real estate companies.
So do its agents, he adds.
Although rising prices in Toronto and Vancouver may be fuelling opportunities for a growing number of sales reps specializing in the luxury market, apparently not just anyone can be a Sotheby’s agent.
“It’s a select group,” says Henderson. “They have to be comfortable selling a luxury brand…It’s much more of a ‘white glove’ service…We want to attract and retain some of the most qualified, successful agents in the marketplace and take them to the next level.”
The brand itself is a huge draw to consumers, he says, being immensely recognizable and associated with quality and prestige.
“That’s a powerful marketing tool our agents are bringing to the client. It differentiates a property,” he says.
“Sotheby’s Canada is affiliated with Sotheby’s International, which has 18,000 agents in 825 offices in over 60 countries. So whilst a lot of real estate is local, increasingly more and more is global. When looking at homes, particularly at the high end of the market, there’s a good opportunity we’ll attract interest from further afield,” Henderson says.
People blame foreign investment for driving up housing prices, but Henderson is convinced that it’s only one of many factors, which include limited inventory, strong consumer confidence and low interest rates.
“Saying that the market can’t sustain price increases is not looking at the fundamentals,” he says. “Our view is that the Canadian market will continue to be healthy and to see price increases in many areas, with a few exceptions in regions dependant on oil or natural resources, such as Calgary.”
With the company’s recent report indicating that the luxury markets in Vancouver and Toronto are continuing to reflect exceptional demand through the first part of 2016, Henderson is happy to have made the move to his new position.
“Other organizations are creating luxury brands,” he says, “but we are the ambassador.”