Toronto CRE rents could soar 50 per cent: JLL

Toronto CRE rents could soar 50 per cent: JLL

Real estate company Jones Lang LaSalle predicts in a study out Wednesday commercial rents in Toronto could rise as much 50 per cent over the next three years in response to the tight market for rental accommodation. At $59.17 per square foot, rents for class-A space in Canada’s largest city place puts it in the competitive company of NYC.

Financial Post

OMB reforms will stifle new housing: Developers

The development industry warns the Ontario government’s plan to dramatically weaken its controversial land-use tribunal, the Ontario Municipal Board, will empower NIMBYs and make it harder to build more housing. The OMB, renamed as the Local Planning Appeal Tribunal, would be limited to ruling on whether a project adhered to provincial policies and a municipality’s official plan.

Globe and Mail  – Toronto Star – Toronto Star – CBC

Avigilon doubles investment with Vancouver office sale

Avigilon, a Vancouver-based security systems firm, has reached a deal to sell its downtown office tower for more than double the price it paid less than two years ago. Avigilon sold the nine-storey tower at 555 Robson Street to an undisclosed buyer for approximately $107.5 million. The firm announced the deal last week.

Property Biz Canada

Vancouver faces ‘extreme’ industrial space crunch

Vancouver’s available industrial space, and land for future development, are reaching critical lows according to CBRE‘s Metro Vancouver Land Report. In fact, the city could run out of industrial land in less than a decade, CBRE says.

Property Biz Canada – CBC – Business In Vancouver – GLOBE-Net

Foreign CRE buyers seek shelter from the storm

“Canadian commercial real estate is at the intersection of two powerful investment trends: the search for hard assets in order to generate yield in a yield-starved world and Canada’s increasing status as a safe haven in a world of growing geopolitical uncertainty,” Paul Morassutti, CBRE Ltd. executive managing director, observed in assessing the investment outlook for Canadian real estate.

Business In Vancouver

Three towers to change Victoria skyline in big way

Victoria’s skyline is about to be altered in a big way with two major developments getting the green light from Victoria councillors. Council has approved two 21-storey condominium towers on Yates Street to be built by Chard Development and a 15-storey seniors complex to be built on Belleville Street by Concert Properties.

Victoria Times Colonist

Ledgeview succeeds in tough Edmonton market

Hungerford Properties’ Ledgeview Business Centre is finding success in a troubled Edmonton market. Despite the weak economy in the region, the Ledgeview centre has recently leased over 21,000 square feet of office space in addition to nearly 5,000 square feet for retail.

Property Biz Canada

Quebec floods recede, but competing demands fill debate

Two days before the major Quebec spring floods began, the mayor of a Montreal suburb proudly announced a new city hall would finally be built after years of renting space in a former shopping centre. The purchase of $1.1 million of prime property in Vaudreuil-Dorion was a bargain. Two weeks later, a good chunk of the land was under water.

Globe and Mail – CTV – Toronto Star – CBC

St. Regis Hotel to make way for SkyCity Centre

Winnipeg’s St. Regis Hotel is laying off its staff as a prelude to the demolition and redevelopment of the 107-year-old downtown building. Developer Fortress Real Developments intends to incorporate it into the SkyCity Centre tower project. Fortress bought the St. Regis as well as a parking lot next door for $4 million in 2015 from CentreVenture, the city’s downtown development agency. 

CBC – Property Biz Canada – Property Biz Canada – Property Biz Canada

Hamilton hoping to attract Toronto investment

Torontonians think Hamilton is solely an industrial town . . . or  worst, they don’t think of it at all. Later this month, the city will make an unusually high-profile effort to change what Toronto thinks when the economic development department rents out space on Queen Street West. The event is called Hamilton Consulate, an effort to encourage investment in the city.

CBC – Global News

Manulife, CRG developing Atlanta distribution centre

Manulife’s U.S. arm  John Hancock Real Estate  and CRG are developing a one-million-square-foot state-of-the-art industrial building in the Atlanta suburb of Locust Grove. The building will be available for occupancy in early 2018. “Atlanta’s thriving business culture makes it a key component of our real estate acquisition and development strategy,” said Manulife Real Estate president/CEO Kevin Adolphe.

Canada Newswire

Dream Global makes first Brussels purchase

Dream Global REIT (DRG.UN-T) announced it has completed the acquisition of all the shares issued by SPE III Runway SPRL, a Belgian entity that holds as its main asset Airport Plaza, a multi-tenant office complex located in Brussels, Belgium. The purchase price was approximately $143.0 million, representing a going in capitalization rate of 7.1 per cent. 

Marketwired

Concert names McCauley CEO successor to Podmoret

The Concert Real Estate Corporation (CREC) Board of Directors and David Podmore announce the appointment of Brian McCauley as president/CEO. Effective June 2, McCauley will assume responsibility for Concert Real Estate Corporation and all related entities – Concert Properties Ltd., CREC Commercial Fund and Concert Realty Services.

Concert Properties blog

Home Capital’s turnaround will only get harder

Home Capital Group (HCG-T) is fighting to find the funds it needs to survive. Then comes the hard part. The Toronto-based bank has lost more than $3.5 billion of deposits since the end of March, hurt by Ontario’s securities regulator saying last month Home Capital had failed to promptly disclose possible fraud among some mortgage applications around two years ago.

Bloomberg – Toronto Star – Globe and Mail (Subscription required) – Globe and Mail (Subscription required)

Canadian grocers narrowing gap with Costco, Walmart

While international retailers Costco (COST-Q) and Walmart (WMT-N) have gobbled up a growing share of Canadian food sales for more than a decade, further gains are expected to be tougher to eke out as the country’s traditional grocers mount an improved defence. Industry watchers say the price gap  has narrowed and the traditional stores’ loyalty programs are helping sales. 

CBC

Featured Column

What you need to know before investing in CRE

I had a client ask recently what I believe to be the long-term risk associated with investing in retail commercial real estate. Let’s ponder that question as it relates to the four major asset classes.

The Saskatchewan Edge

Market Trends and Research

Hamilton developments to have bigger parking spaces

New parking spaces will be bigger in Hamilton to accommodate a trend to larger vehicles. City council’s planning committee voted Tuesday to authorize staff to change the zoning bylaw so commercial, mixed-use and eventually residential developments will need bigger parking spaces.

CBC

Companies unprepared for lease accounting rule changes: AY

Most companies are not on track to comply with new real estate lease accounting rules when they begin to take effect in 2018, says The new Avison Young White Paper: “The Big Change to the Lease Accounting Standards – New rules will significantly impact a company’s enterprise value unless firms act now,” released today.

Canada Newswire

What does future hold for U.S. industrial?

Reports about the effects of e-commerce on commercial real estate usually point to decreased demand for traditional retail space and increased demand for warehouse space near major population centres. As of January, industrial vacancy rates nationwide had dropped for the 27th consecutive quarter. A sizable percentage of new warehouse space is being built on speculation.

GlobeSt.com

Montreal now taxing churches

Churches in Montreal are becoming concerned about hosting community groups after being hit with bills for municipal taxes.
Joel Coppetiers, the Minister at the Cote des Neiges Presbyterian church, was shocked when his institution first received a municipal tax bill in early 2015.
It was “the first indication that something had changed,” said Coppetiers.

CTV

Real Estate Companies

Ford to open distribution centre in Leduc, Alta.

The mayor of Leduc is seeing light at the end of the city’s two-year economic slump. And he’s betting the automotive industry can help drive the turnaround forward. The Ford Motor Company will open a new automotive parts warehouse and distribution centre in the Leduc Business Park.The 400,000-square-foot distribution centre is set to open in the fall of 2018.

CBC – CBC

Trez Capital renews normal course issuer bid

Trez Capital Mortgage Investment Corporation (TZZ-T) announced today it has received approval from the Toronto Stock Exchange for the renewal of its normal course issuer bid, which will enable it to purchase up to 1,210,345 of its 12,283,371 class-A sharesas at May 10, 2017, representing approximately 10 per cent of its public float of 12,103,451 shares as at that date. 

Canada Newswire – Canada Newswire

Mainstreet completes sale-leaseback transaction

Mainstreet Health Investments Inc. (HLP.U-T) announced the completion of the previously announced sale-leaseback transaction with affiliates of The Ensign Group, Inc. (ENSG-Q) of a portfolio of three stabilized assisted living and post-acute care facilities located in Arizona and California. 

Canada Newswire

JPMorgan buys Dublin building with room for 1,000 staff

JPMorgan Chase (JPM-N) has agreed to buy a Dublin building with room for 1,000 staff in the first sign of a financial services company expanding significantly in Ireland since the government began a major campaign to attract firms in the wake of Brexit. The purchase price of the 130,000-square-foot building was not indicated. 

Reuters

REIT Financial Reports

Latest financial results:

* Maplewood International REIT, (MWI.UN-X), Marketwired   

* OneREIT, (ONR.UN-T), Marketwired   

Real Estate Investment Trusts

Granite proposes directors amid FrontFour push

Granite REIT (GRT.UN-T),  Canada’s largest industrial real estate landlord, plans to nominate two new board members amid a push for change by activist investor FrontFour Capital Group and its partner, Vancouver-based Sandpiper Group. Toronto-based Granite, in a regulatory filing Tuesday, cast the changes as part of a board renewal process that began last year. 

Bloomberg – Canada Newswire

Northwest Healthcare belongs in any income portfolio

Northwest Healthcare Properties REIT (NWH.UN-T) offers a dividend with a 7.5% yield. The company’s high-quality portfolio of healthcare real estate properties, located throughout Canada, Brazil, Germany, Australia, and New Zealand, offers investors exposure to a growing market.  Healthcare properties generally have stable occupancies and long-term leases which make the underlying REIT defensive and attractive to long-term investors.

Motley Fool

Retail

Target’s turnaround efforts pay off

Target Corp (TGT-N) reported higher-than-expected quarterly profit and sales as some of its turnaround initiatives, including revamping stores and increased promotions, paid off. The company’s shares rose 8.4 per cent in premarket trading on Wednesday, bringing some cheer to the retail sector, which has been hurt by weak performances from department store chains last week. 

Reuters

PointNorth launches proxy fight at Liquor Stores N.A.

Activist fund PointNorth Capital Inc. launched a proxy battle Monday at Liquor Stores N.A. Ltd. (LIQ-T) aimed at returning the 252-outlet chain to its roots in Western Canada. Edmonton-based Liquor Stores is North America’s largest publicly traded wine and spirits retailer, with the bulk of its outlets in British Columbia and Alberta, and 40 stores in four U.S. states. 

Globe and Mail (Subscription required) – Canada Newswire – Marketwired – Edmonton Journal

Sears CEO lashes out at suppliers

Sears Holdings Corp. (SHLD-Q) chief executive officer Eddie Lampert vowed to fight back against suppliers trying to take advantage of his company, saying “dire predictions” about the retailer’s future have hurt its position with vendors. Some vendors have tried to capitalize on Sears’ situation, Lampert said in a blog post. 

Bloomberg

Home Depot shares hit record high

Home Depot Inc‘s (HD-N) first-quarter profit and same-store sales topped estimates as customers spent more on expensive items such as appliances and roofing materials. The company’s shares rose about two per cent to hit a record high of $160.83 in morning trading on Tuesday, after it said second-quarter sales were off to a good start. 

Reuters – Bloomberg – Bloomberg – Canada Newswire

New Development

Champion Petfoods building new plant near Edmonton

Champion Petfoods announced Tuesday it’s building a nearly 400,000-square-foot facility near Edmonton’s western border that will greatly expand its capacity to produce dog and cat food. The new kitchen will prepare kibble and freeze-dried foods and treats for the Edmonton-based company’s Acana and Orijen brands, and there will also be a distribution warehouse and logistics centre.

Edmonton Journal

Sens owner angered by Hard Rock casino decision

Eugene Melnyk isn’t happy with the decision to move the Hard Rock Casino into Rideau Carleton Raceway. The Ottawa Senators’ owner, who has expressed his desire to have a casino development in Kanata, told Postmedia he was caught off guard by the announcement by the OLG to accept a bid for $320-million redevelopment of the racetrack.

Ottawa Citizen

Infrastructure

Toronto forging ahead with subway plans

Toronto Mayor John Tory has new allies in his ongoing fight to get Queen’s Park to commit to funding the future downtown relief line — three leaders from the 905. The mayors of Markham and Richmond Hill, as well as the chair of York Region, announced they’d support Toronto’s push for the relief line.

CBC – Toronto Star

London gives green light to bus rapid transit plan

The City of London has officially finalized a $440-million bus rapid transit plan. After months of debate around the biggest project in the city’s history, council gave final approval to planned routes during a meeting on Tuesday. The proposed transit system was reduced from a $800-million project combining light rail and buses.

CBC

Cabinet to have final word on infrastructure bank

Finance Minister Bill Morneau says cabinet will have the final say on any projects approved by the Canada Infrastructure Bank, a proposed $35-billion entity the Liberal government describes as an arm’s length Crown corporation. Private investors – including Canadian pension funds – want assurances any project decisions will be free of partisan politics.

Globe and Mail – Globe and Mail – Montreal Gazette

Technology

eBay’s India strategy reveals a major weakness

eBay (EBAY-Q) is handing over the reins of its India business, ebay.in, along with $500 million in exchange for an equity stake in Flipkart, a leading e-commerce company in India. As part of the deal, Flipkart’s customers will gain access to eBay’s global inventory of items for sale on its marketplace, and eBay’s customers will have access to Flipkart items.

Motley Fool

Starbucks software glitch takes some stores offline

Some U.S. and Canadian Starbucks Corp (SBUX-Q) stores were accepting only cash Tuesday because of a payment system outage the company blamed on an overnight software update that knocked some cash registers offline. Starbucks spokeswoman Madeleine Löwenborg-Frick said the company pushed out a software update in line with normal practices and that the outage was unrelated to “WannaCry.”

Reuters

Other

Glass falls from Yorkville’s Four Seasons hotel

Roads in Yorkville have re-opened after glass fell from a penthouse suite at the Four Seasons hotel Tuesday night. Police had blocked vehicles and pedestrians on Bay Street between Davenport Road and Yorkville Avenue and Scollard Street between Bay and Yonge for most of Wednesday’s morning rush hour. No injuries or damage were reported.

CBC