Building June July 2015

real estate development

|

construction

|

architecture

65

building.ca June July 2015 CDN $4.95

03

Small living

PM#40069240

+ BLD Jun-Jul 15.indd 1

Recognizing Accessibility Hotel Market

15-07-02 2:24 PM

PLAN TO USE PURPLE. WALLTITE insulation/air barrier fits perfectly into almost every space you design. ®

Custo Cus

Dr D

Dry Dr ofofs prov pr aga ag

NOW OFFERING WALLTITE

Out Ou wan wa from fro met m

The industry’s highest long-term thermal resistance performance † R 12.4 @ 2” | R 19.2 @ 3” | R 26.2 @ 4”

The Th

Visit Vi

You painstakingly consider the utility, look and feel of your design. But how does it perform? Our closed-cell insulation/air barrier provides trusted long-term energy efficiency and enhances the durability of the building. WALLTITE fits into any curve or corner you imagine, ensuring that you have a well-sealed building envelope.

That means your design gets the high performance it deserves.

At BASF, we create chemistry.

Learn how WALLTITE can enhance your next plan at

www.walltite.com or call toll-free 1-866-474-3538

†

As per Canadian Construction Materials Centre (CCMC) reports for medium density spray polyurethane foam posted December 2011.

WALLTITE is a registered trade-mark of BASF Canada Inc. ECOLOGO is a trade-mark of Environment Canada; GREENGUARD Indoor Air Quality Certified is a registered trade-mark, and GREENGUARD Children and Schools is a service mark, of their respective owners; all used by BASF Canada Inc. with permission. © 2015 BASF Canada Inc.

BLD Jun-Jul 15.indd 2

15-07-02 2:24 PM

Springhill SpringhillSuites SuitesMarriot Marriot&& Homewood HomewoodSuites SuitesHilton Hilton - -Vaughan, Vaughan,ON ON

Custom CustomBrick™ Brick™

Lymestone™ Lymestone™

®® TerraNeo TerraNeo

®® Quartzputz Quartzputz

Tuscan TuscanGlaze™ Glaze™

®® Sandpebble Sandpebble

Reflectit™ Reflectit™

Dryvit DryvitAnnounces AnnouncesHDCI™ HDCI™ Dryvit Dryvitis ispleased pleasedtotoannounce announcea anew newprogram programfor forour ourOutsulation Outsulationand andStratum StratumGuard Guardfamily family ofofsystems. systems.HDCI HDCIis isshort shortfor forHigh HighDurability DurabilityContinuous ContinuousInsulation.

Insulation.Engineered Engineeredtotoprotect, protect,it it provides providesallallthe thefeatures featuresand andbenefits benefitsfrom fromour ourtraditional traditionalsystems systems– –PLUS PLUSa a20-year 20-yearwarranty warranty against againstdamage. damage. ®® Outsulation Outsulation Systems Systemsare area atrusted trustedchoice choicefor forarchitects, architects,building buildingowners ownersand andcontractors contractorswho who want wanta ahigh highperformance, performance,insulated insulatedcladding claddingsolution solutionthat thatcan canprovide provideeverything everythingneeded needed from froma abuilding buildingcode codeperspective, perspective,and anda aversatile versatileappearance appearanceofofstucco, stucco,limestone, limestone,brick brickoror metal. metal.

The Theconcept conceptis issimple simple– –with withDryvit DryvitHDCI, HDCI,if ifthe thewall wallis ispuntured, puntured,Dryvit Dryvitwill willrepair repairit.it.

Visit Visitdryvit.ca dryvit.catotofind findout outmore. more.

For Formore moreinformation informationcall call1.800.263.3308 1.800.263.3308 e-mail e-mailinfo@dryvit.ca info@dryvit.caororvisit visitdryvit.ca dryvit.ca CCMC-12874-R CCMC-12874-R

BLD Jun-Jul 15.indd 3

15-07-02 2:24 PM

Connectrac is the flexible, expandable, elegant solution.

The Connectrac ® In-Carpet Wireway provides a proven power and IT alternative to expensive and disruptive core drilling, trenching and unsightly power poles.

Our ultra low-profile modular wireway is so discreet it’s barely noticeable as it elegantly blends in to any environment. Discover the Connectrac difference today.

CONNECT

WITHOUT

CORE DRILLING ®

Now available for immediate delivery from the Canadian Distribution Center.

1.877.480.5637

BLD Jun-Jul 15.indd 4

www.connectrac.com

15-07-02 2:24 PM

65 03

CONTENTS

what’s on BUILDING.ca

FEATURES 16 > Vancouver’s Could-Be

Micro-Condo Boom /

Is an antidote to Vancouver’s housing affordability crisis being held back by city planners?

By Andrew Sobchak

READ > How long will condos last?

Dan Barnabic discusses the physical life-span of condos.

20 > Building Homes for Boomers Who Don’t Want Them /

24

Millions of Boomers are migrating to multi-family homes. What can we build to make them happy?

By David Allison

WATCH > Toronto Pearson Approaches Capacity What does Toronto Pearson’s rapid expansion mean for land development across Southern Ontario?

24 > Getting Around /

The residential sector is typically slow to react to the needs of people with mobility challenges. A new awards program is aiming to combat that. By Peter Sobchak

26 > Up, Up and Away /

Canada’s lodging real estate market continued its momentum in 2014, marking the fourth consecutive year of investment of over $1 billion. By Fraser Macdonald

EXPLORE > Saskatoon Police Headquarters CS&P Architects design inclusive, communityfocused police headquarters in Saskatoon.

ABOVE IMAGE:

IN EVERY ISSUE 6 > Editor’s Notes

8 > Developments 12 > Market Watch 14 > Legal 30 > Viewpoint

The builders of Place La Charrette in Winnipeg integrated universal design principles in multiple apartment and bungalow layouts within the same housing project to enable a more accessible environment for tenants and guests (Image courtesy of Ten Ten Sinclair Housing).

building.ca

BLD Jun-Jul 15.indd 5

15-07-02 2:24 PM

Volume 65

06

03 Number

Stuck in a moment

Anyone who has ever been seriously injured and had to deal with mobility issues while recovering comes to realize pretty quickly that cities and buildings are not designed with those mobility challenges in mind.

I can attest to that: eight years ago I was hit by a minivan while crossing the road and among the litany of injuries was a severely broken leg. After eventually getting out of the hospital I was faced with the daunting task of using a wheelchair to get around town and, worse, up to my thirdfloor apartment accessible only be stairs. This experience forever gave me an appreciation for the trials many encounter navigating the built environment, from uneven sidewalk surfaces to bathroom access to stairs (which are the leading cause of serious falls among community-living elderly, accounting for about one-third of all fatal falls).

As the residential sector evolves to meet the changing needs and wants to shifting demographics, mobility is always something that seems secondary to most people’s minds. That is, until mobility is taken away from us. And eventually, it always is. Yet this inevitability doesn’t seem to change the way housing structures are built. We still have a housing industry unprepared to meet the needs of the growing aging population, and therefore a lack of housing stock in Canada with basic accessibility features or adaptable for the needs of residents over the lifetime of a house. Home structures are, quite simply, hostile to those with mobility difficulties, and there exists widespread architectural barriers for those who use mobility devices.

Issues like this are why people like Eleanor Smith are important. In 1986, Smith and a group of advocates for people with disabilities introduced the concept of VisitAbility to North America when they launched an initiative called “Concrete Change” that was intended to make a new community in Atlanta, Georgia, being developed by Habitat for Humanity, inclusive for people with physical disabilities. They realized that although some of the houses in the community were planned to be accessible for residents with physical disabilities, these people would not be able to visit their neighbours in the community due to stairs at the entrance and inaccessible bathrooms.

Concrete Change suggested that Habitat for Humanity apply a set of basic accessibility features in every home in the housing project. Hence the VisitAbility Project was born, and it is one of several programs at work in Western countries that share similar goals of one day dictating that all buildings are rendered as universally accessible as possible, and the prime candidate they are focusing the majority of their culture-changing efforts on is the residential sector.

These are not unrealistic goals: in fact, when VisitAbility features are planned at of Member the outset, additional costs are minimal, varying from negligible amounts to several thousand dollars. And it is more than just the elderly that benefit from these considerations: think those with young children in strollers, for example. And reducing injuries to older people and young children means reduced use of acute care hospitals and rehabilitation facilities.

In many respects what we are talking about is integrating tenets of universal design in new residential construction, since one of the goals of universal design is to maximize the usability of environments. This would be equally important to Millennials looking at micro-condo units smaller than a two-car garage, Boomers looking for creative new storage space in the multi-family housing they are downsizing to, or those with mobility challenges who just want to comfortably live in their own space.

Editor / Peter Sobchak Art Director / Roy Gaiot Legal Editor / Jeffrey W. Lem Contributors /

David Allison, Richard Joy, Fraser Macdonald, Andrew Sobchak

Circulation Manager / Beata Olechnowicz beata@building.ca Reader Services / Liz Callaghan Sales Manager / Faria Ahmed (416) 510-6808 fahmed@building.ca Senior Publisher / Tom Arkell President, Annex Newcom LP / Alex Papanou

Building magazine is published by Annex Newcom LP. 80 Valleybrook Dr. Toronto, ON M3B 2S9 Tel: (416) 510-6845 / Fax: (416) 510-5140 E-mail: info@building.ca Website: www.building.ca SUBSCRIPTION RATE: Canada: 1 year, $30.95; 2 years, $52.95; 3 years, $64.95 (plus H.S.T.) U.S.: 1 year, $38.95 US, Elsewhere: 1 year, $45.95 US. BACK ISSUES: Back copies are available for $8 for delivery in Canada, $10 US for delivery in U.S.A. and $15 US overseas.

Please send prepayment to Building, 80 Valleybrook Dr. Toronto, ON M3B 2S9 or order online at www.building.ca Subscription and back issues inquiries please call 416-442-5600, ext. 3543, e-mail: circulation@building.ca or go to www.building.ca Please send changes of address to Circulation Department, Building magazine or e-mail to addresses@building.ca Building is indexed in the Canadian Magazine Index by Micromedia ProQuest Company, Toronto (www.micromedia.com) and National Archive Publishing Company, Ann Arbor, Michigan (www.napubco.com).

Association of Business Publishers 205 East 42nd Street New York, NY 10017

Inc.

Occasionally we make our mailing list available to reputable organizations whose products or services can be of interest to our readers.

If you do not wish to be included, please e-mail or write to us.

Building is published six times a year. Printed in Canada. The content of this ­publication is the property of Building and cannot be reproduced without permission from the publisher.

We acknowledge the financial support of the Government of Canada through the Canada Periodical Fund of the Department of Canadian Heritage.

H.S.T. #815380985RT0001 ISSN 1185-3654 (Print), ISSN 1923-3361 (Online)

|

Peter Sobchak Editor We welcome your feedback. Send your questions and comments to psobchak@building.ca JUNE JULY 2015

BLD Jun-Jul 15.indd 6

Annex Newcom LP. Customer Number: 2014319 Canada Post Sales Agreement #40069240

Proud member of

building.ca

15-07-02 2:24 PM

ONE SYSTEM LEADING TO NET ZERO READY. Owens Corning™ FOAMULAR® CodeBord® Air Barrier System is another innovative solution providing long term energy efficiency performance and comfort for homeowners.

1-800-GET-PINK® or visit owenscorning.ca

THE PINK PANTHER™ & © 1964-2015 Metro-Goldwyn-Mayer Studios Inc. All Rights Reserved. The colour PINK is a registered trademark of Owens Corning. © 2015 Owens Corning. All Rights Reserved.

73% recycled content is based on the average recycled glass content in all Owens Corning fiberglass batts, rolls and unbonded loosefill insulation manufactured in Canada. Minimum 20% recycled content. SCS certified.

BLD Jun-Jul 15.indd 7

15-07-02 2:24 PM

08

MENTS

DEVELOP-

Expect more mergers and acquisitions in the A/E/P industry FAYETTEVILLE, Ark | Zweig Group’s new 2015 Merger & Acquisition Survey of A/E/P and Environmental Consulting

Firms found that the number of firms in the industry across North America considering M&A activity is on the rise, with the percentage of firms considering buying another firm up slightly this year to 42 per cent, and more than two-thirds of firms (68 per cent) report M&A is in their strategic plan for the next five years. Among firms looking to make an acquisition, the highest-ranked reason for an acquisition is to enter new markets. Civil engineering ser-

News Canada’s first 2030 District launches in Toronto

Don

u Bath

t. rst S

y Va l l e

TORONTO | Toronto has officially joined the 2030 District collaboration initiative with an area that encompasses the down­town core from Dupont Street to St. ont Lake Ontario, and the Don Valley to Bath­ p u D R o s e d a le urst Street. With over 550,000 people Va ll e y living and working within the district’s boundaries, the Toronto 2030 District is the largest to-date outside of the United States, which already includes Seattle, Cleveland, Pittsburgh, Los Angeles, Den­ ver, Stamford, San Fran­cisco and Dallas.

These 2030 Districts focus on collecDOWNTOWN TORONTO tively solving the challenge of urban greenhouse gas emission reductions that government, industry and community organizations cannot achieve on their own.

Spearheaded by a group of over 30 private and public organizations, the goal is to create a high-performance district that aligns policy, design and market drivers to accelerate the pace of innovation rio in dealing with climate change. nta O Working together, Toronto 2030 Diske La trict founding sponsors the Ontario Association of Architects (OAA) and Sustainable Buildings Canada (SBC), and lead sponsor Enbridge Gas Distribution, along with the members of the district’s advisory board, which includes representatives from Brookfield Office Properties, Avison Young, Integral Group, Energy Profiles Ltd., Jones Lang LaSalle, Diamond Schmitt Architects, Coolearth Architecture, BOMA Toronto, Canadian Urban Institute, the City of Toronto and Ryerson University, want to fast track positive change in the building sector and will target immediate reductions, working towards 50 per cent lower emissions by the year 2030.

To accomplish this they aim to leverage existing local programs, increase information sharing, promote district-wide benchmarking, create economies of scale and build performance data. “The 2030 District is a forum for collaboration that amplifies the success of existing conservation programs, removes redundancies and fills the gaps by sharing knowledge to build best practices. It establishes a framework for other cities in Canada to follow suit,” says Jeff Ranson, Executive Director, Toronto 2030 District.

JUNE JULY 2015

BLD Jun-Jul 15.indd 8

Toronto 2030 District

building.ca

15-07-02 2:24 PM

‘‘The Toronto 2030 District allows us to harness all of our brain power, knowledge and experience to improve the way we build, manage and operate buildings. Never before have we had a forum like this that brings everyone together to develop better building, construction and operational solutions.’’

— Steve Ichelson, VP Operations at Avison Young Real Estate Management Services.

vices and firms working in the commercial development market have the most demand, with half or more of potential buyers interested.

New residential report shows need for more than 129,000 skilled workers

“The combination of a recent trimming of the fat in the industry, coupled with a strong outlook in the future, and access to funds means this is a great time to consider strategic acquisitions or joint ventures,” says Jamie Claire Kiser, director of M&A services for Zweig Group. “The industry’s structure continues to transform to a more integrated business model, and responding quickly and nimbly to the change. Consolidation will become increasingly common as firms seek to either serve as a ‘onestop shop’ and provide full-service design, building, and engineering services, or seek to specialize and find niche markets to fuel growth, such as green design. The economic outlook for architects is strong over the next few years.

The downstream construction markets have rebounded since the recession and new international markets are providing global growth possibilities.”

OTTAWA | With Canada’s home renova-

09

tion industry continuing to grow, new construction holding steady, and an aging workforce with many people nearing retirement, Canada’s residential construction industry will need more than 129,000 new skilled workers over the next decade, according to a new residential construction labour market information report by BuildForce Canada and the Canadian Home Builders’ Association (CHBA) that focuses exclusively on supply and demand for home builders and renovators.

BuildForce Canada’s first annual La­ bour Market Assessments for the Re­sid­ ential Construction Industry 2015-­2024 report shows renovation and maintenance work will rise steadily as the housing stock ages, already more than $60 million annually and making up more than half of the investment in residential construction. With modest growth overall in new housing construction, including declines in some regions, the demand for residential construction workers will continue to shift to the renovation sector. The report shows the biggest challenge across all provinces is the aging residential construction workforce and the need to replace about 114,000 skilled workers retiring this decade.

Internationally, construction industry needs overhaul to bolster productivity NEW YORK | A new report published by The Economist Intelligence Unit says the construction industry internationally needs a major overhaul if it is to bolster its declining productivity. Rethinking productivity across the construction indus­ try: The challenge of change, sponsored by Autodesk, reveals that 74 per cent of construction executives say productivity is a major challenge recognized by their leadership. But almost half (48 per cent) admit that their firm has failed to develop a coherent strategy to address the decline.

Productivity is an industry-wide issue rather than firm-specific, with 74 per cent of construction executives say lagging productivity is a major challenge for the industry. Executives identified the biggest obstacles to improved productivity as: a lack of skilled labour (first); clients’ procurement methods and contract terms (second); and government requirements (third). The report also finds that the early adoption of technology can help firms buck the trend. Nearly three of four (74 per cent) high-productivity firms are likely to be early adopters of productivity-enhancing technologies. Respondents say technologies supporting greater collaboration and information-sharing are best positioned to boost productivity in the next three years. building.ca

BLD Jun-Jul 15.indd 9

15-07-02 2:24 PM

MENTS

DEVELOP10

DTZ creates industry giant by acquiring Cushman & Wakefield NEW YORK | DTZ, a commercial real estate services backed by the TPG private equity firm, has acquired Cushman & Wakefield for US$2 billion, creating one of the world’s lar-

To design the new layout, the Partnership commissioned Montréal-based Pépinière & co, a non-profit organization whose mission is to promote, inspire and showcase creativity through urban projects, for example the successful Village Éphémère 2014 (Build­ ing, August-September 2014). The new facilities will include repurposed shipping containers hosting bar and restaurant services, a large patio inspired by classic German beer gardens covered by a luminous canopy, a stage, and areas dedicated to urban agriculture and a local produce market.

In addition to the elements produced

by Pépinière & co and the Partnership, numerous partners have been invited to participate in animating the space, such as Montréal complètement cirque and Montréal Pride will return this year, and several other events will use the space for the first time, including the OFFTA live art festival, the Festival in­ ter­national de littérature and the Mon­ tréal Country Festival. Nearby institutions such as the Université du Québec à Montréal and Bibliothèque et Archives nationales du Québec will also contribute to the summer program.

gest realty firms. The new company, which will operate under the Cushman & Wakefield brand, will have revenues over US$5.5 billion, over 43,000 employees and will manage more than 4 billion square feet globally. The transaction, expected to close before the end of the year, means the new Cushman & Wakefield will vie with JLL as the second-largest commercial realty firm behind global revenue leader CBRE, which had $9 billion in revenue in 2014. Cushman & Wakefield will be led globally by Brett White, the former CEO of CBRE. Carlo Barel di Sant’Albano, current International CEO of Cushman & Wakefield and EMEA CEO, will take a senior global leadership role. John Santora, current CEO of North America at Cushman & Wakefield, will become Chief Operating Officer and Chief Integration Officer and Tod Lickerman, current Global CEO of DTZ will assume the role of President of the global company.

Bayside Toronto development’s first building officially underway Place Émilie-Gamelin

New Projects Place Émilie-Gamelin gets low-tech, citizen-led overhaul MONTRÉAL | To help celebrate Montréal’s 350th anniversary, Place Émilie-

Gamelin in the Quartier des Spectacles will have a new look between May 7 and October 4. A temporary arrangement led by the Quartier des Spectacles Partnership and the Ville-Marie Borough, Les Jardins Gamelin will encourage Montréalers to use this public space in the heart of the city more often, with the ultimate goal of making the space a major tourist attraction.

JUNE JULY 2015

BLD Jun-Jul 15.indd 10

TORONTO | Construction has officially

begun on Aqualina, the first of eight buildings in the 13-acre, $910-million Bayside Toronto development, which is Waterfront Toronto’s largest privatesector development project to date.

When development is complete, there will be two new office buildings with 400,000 square feet of space, and 1,800 units in six residential buildings. Designed by Arquitectonica, Aqualina will be defined by a series of distinctive cubes made of glass and steel with an-

building.ca

15-07-02 2:24 PM

11

Aqualina

gled windows and balconies to maximize views of the skyline and lake. Ranging from one- to three-bedroom residences, its 362 condominium suites will be ready for occupancy in July of 2017, with final completion scheduled for September of 2017. The larger Bayside development aims to be Toronto’s first LEED-ND Gold neighbourhood, and all buildings will target LEED Gold certification or higher. Waterfront Toronto’s policy provides for at least 20 per cent of all residential units to meet City standards for affordable rental units, while at least 7.5 per cent will also be designated market rate rental units. So far, 80 affordable rental housing units are planned for Bayside.

therapy; occupational therapy; autism services; speech and language services; infant hearing and screening services; vision services; recreation therapy; social work services; auditory verbal therapy, and more. The cost of design and construction is $163.33 million, which will be provided by the Ministry of Children and Youth Services, which is also providing funding to support the acquisition of land, project planning and overall project management. ErinoakKids is raising $20 million — $15 million for therapy/treatment program equipment and furniture, and $5 million to support specialized services through its $20 million In My Dreams capital campaign.

People in the News

Ground broken on province’s largest respite centres BRAMPTON, ON | ErinoakKids, the largest children’s treatment centre in Ontario, broke ground on new facilities that will represent the largest of their kind in the province and are part of a much-needed redevelopment project approved in 2011 by the Ontario Ministry of Children and Youth Services. The project will enable ErinoakKids to consolidate its current patchwork of outgrown and mostly leased and retrofitted office and commercial spaces into three larger sites — a 122,000 square foot one in Brampton, a 103,000-sq.-ft. facility Mississauga, and a third in Oakville. This project is the largest in the history of the Ministry of Children and Youth Services and the first multi-site build of a children’s treatment centre in Ontario.

Set to open in spring 2017, the three sites are designed specifically for the care of children and youth with special needs and will offer a variety of services, including: physio-

In memoriam: Roger du Toit TORONTO | Roger du Toit, 75, died of injuries sustained after being hit by an SUV while cycling in Toronto. Du Toit was a founding partner of the firm DTHA which, among many other projects, helped design the CN Tower. “Roger’s leadership in the realms of community and campus master planning, urban intensification, and innovative transportation planning is second to none,” DTHA said in its statement. According to the CBC, Du Toit was struck at 8:23 a.m. on May 19 at the intersection of Wrentham Place and Roxborough Street East — a T-intersection in a residential area that’s close to an exit to Mount Pleasant Road. Toronto police said du Toit was northbound and had entered the intersection when he was struck by a 43-year-old woman driving a Toyota 4Runner eastbound. He suffered life-threatening injuries in the collision. DTHA said du Toit died peacefully and surrounded by family. b building.ca

BLD Jun-Jul 15.indd 11

15-07-02 2:24 PM

12

MARKE T Drop in the Bucket?

Spotlight: Oil Impact

ment infrastructure projects are still proceeding, but cautiously.”

As for factors limiting future growth, financial pressures and competition from rivals remain the most important with planning and regulatory constraints and weather coming in next. And a third of those asked were affected by labor shortages, especially in securing surveying and other construction professionals. As for the longer-term outlook, respondents expect both workloads and the job outlook to improve over the next 12 months, though with less confidence than in the previous quarter.

Dropping oil prices negatively impacting Canadian construction and real estate returns

Vacancy on the rise The volatility in oil prices is also manifesting itself in the Canadian office market in ways only beginning to be realized, with national overall vacancy escalating to 11.1 per cent from 10.7 per cent during Q1, and negative 1.4 million square feet of net absorption nationally, due to a pullback in demand in Calgary, according to research from CBRE. Yet despite recent notable changes, Canada remains one of the world’s safest havens for real estate investment, according to the Colliers International Q1-2015 Canadian Real Estate Capitalization Rate Re­ port. Other than Alberta, the markets are stabilizing throughout Canada and the country remains an attractive location for global real estate investment. However, investors are increasingly becoming more cautious as the conditions with regard to world oil prices continue at current levels, potentially creating upward pressure on capitalizations rates as the year progresses.

Nowhere in the country are the dropping oils prices being felt more strongly The recent and substantial drop in oil prices, while welcome news for drivers than in Alberta, the Canadian province at the gas pumps, is having an adverse and negative impact on construction in most acutely impacted by the rise and Canada, according to several new studies including the latest Canadian Confall of international oil inventory and struction Market Survey, conducted by the Royal Institution of Chartered Surprices. Canadian oil producers are proveyors (RICS). As a result of the price decline, overall Canadian construction output jected to lose an estimated US$40 bilis expected to be two per cent lower than it would have been if not for the oil drop. lion in revenues in 2015, taking a toll The effect is being felt most strongly so far in the oil, gas and energy sector, with on business investment and corporate 68 per cent of respondents reporting that the price decline has been responsible for profits, with some industry players decancellation of projects in those areas, and nearly 90 per cent believing that workciding to cut their capital expenditure loads will be further reduced over the coming year. And the budgets this year. According to The Conference Board of Canregional trend from the previous quarter continues, with Onada’s Metropolitan Outlook: Spring 2015 report, Calgary’s tario expected to see the strongest investment in construceconomy is expected to shrink by 1.2 per cent this year, while tion in coming years and the Prairies’ expected construction Edmonton’s real GDP is forecast to fall by 0.8 per cent. The fortunes continuing to fall with the price of oil. energy sectors in both cities will decline, but other sectors will “Alberta is bearing the largest brunt of the downturn with also feel the pinch from lower oil prices, including construcreduced expenditures and a likely decline in tender price extion, transportation and warehousing, and wholesale and repectations,” said Marlon Bray, Director, Cost Consulting & tail trade. But with oil prices expected to recover somewhat Project Management, Altus Group. “While construction outnext year, modest economic growth is anticipated for both citput is predicted to be lower across Canada, Ontario remains ies next year. Specifically, Calgary’s real GDP is forecast to rise in an optimistic position with continuing investment in the by 1.5 per cent and an expansion of 1.3 per cent is projected residential, commercial and infrastructure sectors.” for Edmonton in 2016.

An Alberta government official expanded on the effect of “The collapse in oil prices has significantly altered the ecothe oil price drop on his province. “Any activities connectnomic outlook among Canada’s largest cities. Most other cited to the oil sands are taking a real hit,” the official said. ies will see their economic fortunes improve this year, thanks “There’s a lot of news regarding larger oil companies, includlargely to a weaker Canadian dollar and a stronger U.S. econing multinationals like Total, that previously expressed interomy,” said Alan Arcand, associate director, Centre for Municiest in investing in oil sands but are now putting projects on pal Studies. “On the other hand, the slump in oil prices will hold, and this is showing across Alberta. There are still a fair take its toll on the economies of Calgary and Edmonton and to amount of commercial and residential projects in progress a lesser extent on Regina and Saskatoon.” but the industrial sector is definitely taking a hit, and governJUNE JULY 2015

BLD Jun-Jul 15.indd 12

building.ca

15-07-02 2:24 PM

Toronto The Toronto real estate market is projected to remain active, though likely less robust than in 2014. “Toronto has become an attractive and safe global destination for real estate investments,” said Marlyn. “There is currently an abundance of available institutional and foreign capital pursuing limited investment grade product, and off-market transactions are continuing to grow in frequency.”

Montréal Montréal’s real estate development continues to be driven by significant new condominium construction, although there are two new substantial office developments underway. The Colliers International forecast for the balance of 2015 is for a continuation of stable market conditions.

Vancouver and Victoria In Vancouver, capitalization continues to compress to lower levels than anticipated and substantial demand from a wide variety of investors, in particular from mainland China, has combined to drive returns and yields to record lows. The Greater Victoria investment market has experienced a general compression in overall cap rates, partly due to rising demand for well-located and maintained assets, with all-time low interest rates and ample availability of financing opportunities continuing to drive demand.

and a good portion of the increase in unemployment will be felt in Calgary, which in turn will create an increase in the amount of available office space as oil companies with fewer employees simply need less office space.”

13

Edmonton While historically there is a low correlation between oil prices and Edmonton office market absorption, current oil market conditions will result in a reduced demand for the products and services energy related industries operating in Edmonton require.

Ottawa The market in the nations capital continues to struggle with high office space vacancy and this will be the wildcard in the office market continuing through 2015. Limited supply of in­dustrial land throughout the National Capital Region will continue to drive down capitalization rates found for this asset class.

Winnipeg Winnipeg is coming off a record year for commercial sales in 2014 with investment sales on properties in excess of $1 million topping $969 million. Looking forward, investment sales are not expected to reach 2014 levels unless some substantial assets are traded.

‘‘The collapse in oil prices has significantly altered the economic outlook among Canada’s largest cities. Most other cities will see their economic fortunes improve this year, thanks largely to a weaker Canadian dollar and a stronger U.S. economy.

On the other hand, the slump in oil prices will take its toll on the economies of Calgary and Edmonton and to a lesser extent on Regina and Saskatoon.’’ ­— Alan Arcand, associate director, Centre for Municipal Studies Calgary

Halifax

“The downtown Calgary office market has already witnessed an increase in vacancy to 11 per cent in Q1-2015, up from 8.52 per cent in just the last quarter and 8.13 per cent year-over-year,” said Chris Marlyn, Colliers International. “The dramatic decrease in oil prices will cause unemployment,

The Halifax office market is expected to fluctuate before eventually stabilizing throughout 2015. Given its prominent position as a major east coast industrial centre, new ship building contracts will likely result in an increase in rental rates in 2015 throughout the industrial asset class. b

Canada Construction Market Workload 30

Sectors vulnerable to oil price decline

% Net balance

100 % of respondants saying ‘yes’

25 80 20 60

15 10

40

Source: RICS

5 20

0 -5 -10

0 Q2-2013

Q3-2013

Q4-2013

Q1-2014

Q2-2014

Q3-2014

Q4-2014

Q1-2015

Public housing

Private housing

Private industrial

Infrastructure

Public non-housing

Private commercial

Energy, oil & gas

building.ca

BLD Jun-Jul 15.indd 13

15-07-02 2:24 PM

14

LEGAL Bill 106 and the Dawning of a New Condominium Era Ontario hits it out of the ballpark with an exhaustive overhaul of the Condominium Act

By Jeffrey W. Lem

Well, the much-anticipated condominium law reform bill has finally been tabled. Bill 106, the Protecting Condominium Owners Act, 2015 (the “Bill”), was recently tabled by the Minister of Government and Consumer Services, David Orazietti, and the draft legislation is already receiving much acclaim. It is spectacular new legislation that will herald a real paradigm shift in condominium ownership in Ontario, and arguably none too soon ­— Ontario is now home to more condominiums than any other jurisdiction in the western world, with an estimated 1.3 million Ontarians living in over 700,000 condominium units in the Province, and with every other new home being built in the Province being a condominium of one sort or another.

Further dissection and analysis of the Bill will follow, no question, but one thing is for certain, if the Bill passes, Ontario will see condominium ownerA storelegislation on West ship that: Street in Goderich, Ont.’s historic downtown before the more comprehensive rules regarding the costs of 1) has clearer, tornado hit (above), a newly-built condo; the damage (right), and in August 2013 (below) after the town’s 2) establishes a brand new, not-for-profit condominium authority rebuilding efforts.

Alas, the foregoing summary of the legislation, aside from being too simplistic, does not tell the whole story of the Bill.

Firstly, this summary does not reflect the sheer breadth and sweeping scope of the revisions sought to be introduced by the Bill. Literally, not a single stone has been left unturned in terms of improving the condominium ownership experience in Ontario. Implementing about 200 recommendations received in the consultation process, there are few, if any provisions in the Condominium Act, 1998 dealing with corporate governance, owner’s rights or the new-condominium purchasing process that have escaped impact by provisions of the Bill. This is a testament to the incredible hard work that went into the Bill by the Ministry of Consumer Services (now the Consumer Protection Ontario arm of the Ministry of Government and Consumer Services) and their lawyers from the Legal Services Branch of the Ministry of the Attorney General.

Secondly, the summary belies the sheer quality of the legislative drafting involved in formulating the Bill.

In terms of legislative drafting, and totally irrespective of the vast changes to substantive law that the Bill introduces, the Bill is actually quite masterfully written. In my short stint so far as the Director of Titles, I have come

buying

to pro-

vide quicker, lower-cost dispute resolution;

3) introduces tougher financial management rules for condominium corporations to help prevent financial and organizational mismanagement; 4) mandates formal training and other governance improvements for condominium directors; and 5) implements, through another brand new not-for-profit authority, mandatory licensing and education requirements for condominium managers, historically a source of many of the frauds and other financial mismanagement that have plagued condominium ownership.

JUNE JULY 2015

BLD Jun-Jul 15.indd 14

building.ca

15-07-02 2:24 PM

Literally, not a single stone has been left unturned in terms of improving the condominium ownership experience in Ontario.

Jeffrey W. Lem is Editor-in-Chief of the Real Property Reports and the Director of Titles for the Province of Ontario. The opinions expressed in this article are personal to the author and not attributable or referable to the government of the Province of Ontario.

to appreciate that there is a real art to legislative drafting — the long and arduous process that transforms the desire for political reform into practical enforceable law — more so, when the reform sought is quite technical in nature, as is condominium governance. Unlike other legislative efforts, the Bill is no blunt instrument — there is a lot of nuance and precision evident in the drafting, and it is obvious to me that the legal teams involved in the drafting of the Bill, both at the Legal Services Branch and at the Legislative Counsel sections of the Ministry of the Attorney General, really outdid themselves in terms of pure legal craftsmanship.

Thirdly, the Bill itself belies the incredible amount of stakeholder input and consultation that went into the policy making long before pen ever hit paper on the Bill. While antecedent stakeholder input and consultation is pretty much politically de rigueur in legislative drafting at all levels these days, the exhaustive collaboration and consulting review process that preceded the introduction of the Bill was truly remarkable. It included public information sessions, the creation of a residents’ advisory panel, the receipt and consideration of over 400 written submissions, and, most importantly for readers of Building, an expert panel comprised of, inter alia, some of the Province’s most prominent condominium developers and their lawyers. Those experts from the condominium development sector gave so freely of their own time and considerable expertise in furtherance of this process that this Bill is just as much theirs as anybody else’s.

Fourthly, this summary of the Bill gives little hint of how much there is still left to do in implementing the new condominium ownership regime. Even if the Bill passes more or less as it reads now, implementation will still require extensive regulatory drafting. It is not unusual to leave a lot to regulation in modern legislative drafting, and this was very much the case when the Condominium Act, 1998 was introduced, but the point is that, even though the Bill is both broad and deep in its reforms, much regulatory drafting still remains to be done to achieve and implement the contemplated reforms.

One part of the Bill, however, belies nothing — its title. As the term, “Protecting Condominium Owners” denotes, the Bill is all about the consumer protection for condominium owners. Although there are some sections of the Bill that deal with what technical condominium development issues (see below), the overwhelming thrust of the Bill is consumer protection for condominium owners after the condominiums have been built, occupied and turned-over.

The condominium governance focus of the Bill will make it naturally of most interest to condominium unit owners, the condominium boards that govern their lives, and the building management industry which manages and maintains their buildings. That said, there are many provisions in the Bill that will also be of keen interest to developers and builders of condominiums, including the greater flexibility now allowed for the development of different types of phased condominiums, the greater clarity that the Bill provides on the scope of easements that can be created in the declaration of a condominium, and the expansion of Tarion warranties to conversion buildings (new territory for the home warranty program). Developers and their lawyers will also be paying close attention to the increased and improved disclosure that developers will soon have to give to prospective purchasers about condominium living, operations and post-closing costs, and considering how their sales processes will have to adjust in order to comply with the Bill.

As Odysseas Papadimitriou, a real estate lawyer at Miller Thomson and an expert in condominium development and governance observes, “This really is a game changer. The previous amendments to the Act, which came into effect in May of 2001, helped make Ontario a forerunner in condominium development. The amendments contemplated by the Bill will allow Ontario to continue on that path but also take us a step further to make Ontario a leader in condominium governance and con­sumer education as well.” b

15

building.ca

BLD Jun-Jul 15.indd 15

15-07-02 2:24 PM

VANCOUVER’S COULD-BE MICRO-CONDO BOOM

16

Is an antidote to Vancouver’s housing affordability crisis being held back by city planners?

A By Andrew Sobchak

At this rate, Vancouver’s Millennials may never be able to afford a house. According to April statistics released by the Canadian Real Estate Association, the average house price in Glass City was $899,198, which increased 12.2 per cent in one year and is now more than double the Canadian average. The real estate market here is a special concoction of circumstance fueled by Chinese investment and buffered by a mountain range which effectively prevents lateral expansion. As the city builds vertically many are wondering why micro-condominiums are not prominently in the mix If micro-condos were to boom anywhere in this country, most would predict Vancouver to be the epicenter. Developers bill them as affordable entry points into established markets; and the density they bring and demographic they attract are an urbanist’s dream. Yet micro-condo high-rise projects here simply don’t exist.

A total of one has been permitted — a special allowance due to a heritage building reconstruction in the Downtown Eastside, while other neighbourhoods remain micro-condo deserts and other cities like Toronto, New York, Seattle and Boston embrace them entirely. It turns out a minimum unit size bylaw is preventing their purchase. In a city where density is the only development option, why is the City

JUNE JULY 2015

BLD Jun-Jul 15.indd 16

building.ca

15-07-02 2:24 PM

Visit building.ca for a look at Seattle, which has seen minimum unit sizes drop and then increase again to stem untoward activity.

of Vancouver blocking micro-condo development at the very time it could be using them to help address its housing affordability crisis?

Small living possesses a certain spectacle. Especially in Canada, a country with the world’s 230th lowest ranked population density, it seems ponderous, or possibly preposterous, to most that some can find happiness in a home no bigger than a one car garage, a home

Jackson’s concerns are fundamental: unit and building design; impacts on surrounding neighbourhoods and city services; and propagation of the already investor-happy real estate market. None of this, he claims, has been studied long enough in the Vancouver context. “It’s all about livability for the people who are in those units,” he says. “They may be small but are they designed with higher ceilings, good access to light? Additionally, we need to look at their development in terms of what it would do to surrounding land value prices, how do we handle them in terms of parking, what it does in terms of the type of amenities which will have to be provided indoor and outdoor to balance off the smaller private spaces.”

Some may disagree with Jackson, but the Canadian mortgage industry does not, spinning the issue of minimum unit sizing from a re-sale perspective.

17

Image: Neil M. Denari Architects (NMDA)

Reliance Properties hopes to build a residential tower at 902 Davie Street in Vancouver, designed by Los Angeles-based Neil M. Denari Architects (NMDA) and comprising micro-units between 175 and 275 square feet.

where the bed folds out of the wall and there is no room for a bath tub. Small living isn’t for everyone, and micro-condos aren’t for most Canadians.

“We don’t want to warehouse people,” says Brian Jackson, Vancouver’s general manager of planning and development. Jackson has come under fire recently for his department’s response to the growing North American popularity of micro-condos. Section 10.21.2 of the city’s Development Bylaw 3575 allows for a minimum condominium size of 398 square feet — but nothing smaller, and in the parlance of micro units which routinely edge below 200 square feet, this threshold is gargantuan.

“When it comes to condos, minimum size limits is a real thing with virtually all mortgage lenders in Canada,” says Damian Wickie, principal of Toronto-based brokerage Branch Financial, Inc. “500 square feet is the typical minimum threshold, [and] most lenders will quote market statistics which dictate anything smaller than 500 square feet is far less desirable to the average consumer and therefore affects overall and future marketability.” Exceptions for condos under 500 square feet can and are routinely made if they are insured, Wickie says, and the insurer supports the value of the unit relative to size, location and re-sale potential.

The concern amongst lenders is in creating too niche of a product which becomes difficult to re-sell in times of hardship. If micro-condos are proven to be livable, and therefore attractive to more buyers as a result of their location through the first re-sale cycle, minimum sizing restrictions with lenders are likely to drop or be waived more regularly.

Market’s Appetite for Small

For David Wex, founder and partner of Urban Capital, livability is something which should be determined by the consumer and not by government officials. “Is it more building.ca

BLD Jun-Jul 15.indd 17

15-07-02 2:24 PM

18

One car garage

Micro-condo

livable to have a small space downtown or spend two hours in transit to a larger place outside of town?” he wonders.

“That’s a decision the people have to make.” Urban Capital was instrumental in bringing the micro-condo movement to Toronto in 2013 with their BILD Award-winning Smart House. Not encumbered by the same minimum unit size restrictions as Vancouver, the achitectsAlliance-designed project features 241 units ranging up in size from 289 square feet and is now under construction in Toronto. The concept was popular enough to prompt Urban Capital to release Smart House Ottawa, which opened for sales in October.

“I don’t know if there is an arbitrary number to make them livable, but I think it is a mixture of things including layout and design. 398 square feet might be less livable than 350 square feet depending on layout,” suggests Wex “If you have functional furniture – furniture that does double duty – then you make spaces more livable.”

Let’s not forget, before the flashy micro-condo and its colourful siblings, pico-dwellings, nano-suites, fun units and the cleverly named ‘launching pads,’ a tiresome ancestor existed: the studio. Studio condos and apartments were often embarrassingly small, just compact versions of larger one- or twobedroom units, outfitted with the same full-sized furnishings and appurtenances. “When average unit sizes went from 700 square feet to 550 square feet or whatever the number happens to be, JUNE JULY 2015

BLD Jun-Jul 15.indd 18

Two car garage

nothing was redesigned,” Wex notes. “The kitchen stayed the same and the bathroom stayed the same, which meant the residual space was really small.” Microcondos improve on the studio because everything within the four walls is strategically implemented.

Wex describes the Smart House as much a “branding exercise” as design innovation: “[It] took to another level some of our design moves, it took to another level some of our sizing. Instead of hiding the smallness, we embraced it and talked about the benefits. Less is more, that kind of lifestyle.” The Vancouver minimum-size restriction bylaw feels like a product of studio-era smallness, unresponsive to the innovations in space usage in contemporary micro-condos which make small spaces more livable.

According to Canadian condominium market researcher Urbanation, 3,000 micro-condos are expected to enter the market in Toronto. When asked if microcondo lessons from other domestic markets can be imported to Vancouver, like Smart House or this latest batch of units, Jackson is skeptical: “Nobody [in North America] has the history yet to understand the impact on a community and on individuals. It hasn’t been long established, so it is very difficult to say who has done it or will do it successfully.” And international markets like Tokyo, Hong Kong or certain European cities? “They have a totally different lifestyle which makes it difficult to transfer their experiences to North America,” he notes.

A Small Experiment

Vancouver’s own micro-unit pilot project is in the Downtown Eastside neighbourhood. “The Downtown Eastside presents us with one of the most difficult conundrums in our city in that the income levels are so much lower than they are in the balance of the city,” says Jackson. “So we are trying any type of innovative housing form to replace the Single Room Occupancies we have and we are looking at the market to help solve that problem. In that case, if it meant having units there which were smaller than elsewhere in the city, we want to try that as one of the housing solutions.”

Over the past five years, micro-unit projects have been permitted and developed including several rental projects and one condo building, the latter being allowed to proceed only because it had heritage significance. “There were issues associated with its rebuilding,” notes Jackson, “so we allowed it to happen in that particular instance.”

One of the rental projects which got the go-ahead, the 2011 Burns Block micro-lofts, eventually received such positive reviews and press that proponents, Reliance Properties, have gone to the micro well several more times with developments including a converted hotel in Victoria, The Janion, and their latest conbuilding.ca

15-07-02 2:24 PM

Rent small = Big returns

size bylaw, but even if there is a reduction, Jackson does not appear interested in pushing the limit on small. “I don’t think we could go below 250 square feet.

I’ve seen units as low as 220 square feet — even as small as 180 square feet — and it tends to be not much better than a small utilitarian hotel room.”

Jackson may be willing to eventually compromise with Stovell on unit sizes below 398 square feet, but it is the ‘eventually’ that may be stunting more interest in micro-condos. “We have said, ‘Yes, Jon, we are interested in doing this, but it is going to take some time to investigate this, come forward with recommendations and accept an application with units as small as 250 square feet,’” notes Jackson. When asked if he has received significant interest from other developers to build micro-condo projects, Jackson replies he hasn’t.

Clearly, Brian Jackson’s approach to the micro-condo potential can be characterized as cautious: an approach supported by mortgagors, but exasperating to hungry buyers looking for a toehold in the climate of Vancouver’s housing affordability crisis and the de-

19

With the barriers to developing true micro-condos in markets like Vancouver, and general condo market conditions softening in other Canadian centres, some developers are taking the rental road to building small, along which regulations can be different. In Vancouver, the smallest rental units can be 320 square feet, except for the Downtown Eastside where policy allows for a reduction to 250 square feet: an exception rooted in the need for replacement housing of the present deteriorating stock of SRO buildings and to provide a range of affordable housing opportunities for a variety of age groups and income levels.

For developers, the attraction of rentals distills down to simply a better return on investment. “There is no doubt about it. The return on a welldesigned small unit is better because you get about the same rent and it doesn’t cost as much,” says David Wex. In fact, research in Toronto

by Urbanation suggests return per square foot is about 20-25 per cent more with a micro-unit, while the Urban Land Institute’s 2014 report The Macro View On Micro Units suggests cost per square foot is only five per cent more to build small.

The attraction for Wex is enough that Urban Capital is considering converting Smart House Ottawa to a rental project, acknowledging an oversupplied condo market at the moment is not creating favourable conditions for selling. “We may want to continue owning this asset, which is in a part of town where we have created a lot of value,” he notes. “We are thinking we may want to run it as part of a furnished rental which we think will be more valuable, and that is hard to do when there are other owners involved.”

Wex is not alone. Even though micro-condos are billed by developers as affordable entries into over-heated real estate markets for first-time buyers or the One Plus Dog Generation – those Visit building.ca for a summary of the ULI report, The Macro View Millennials entering and establishing themselves on Micro Units, and why Millennials are keen buyers of micros. in the workforce – many are snapped up by velopers who wish to service them. overseas or domestic investors and rented back out to these same target “I’d like to look at a pilot project or two demographics. The supply restrictions haven’t yet allowed for market of micro-suites in the downtown area,” forces to equalize and micro-condos to be available for all who want to buy says Jackson, suggesting a test outside them. Until supply is increased, a trickle may only add fuel to the housing the pilot projects in the Downtown fire in locations like Vancouver.

Eastside. “The easiest way to deal with The spectre of investor-driven demand is hard for micro-condos to the time issue is to allow one or two pishake. “It’s true there is a negative connotation, but investors are heavily lot projects to proceed and monitor into condos whether they are big or small,” says Wex, noting investors those very carefully. This would have key on condos in popular locations in both Toronto and Vancouver. Microto come from our housing policy staff condos can become investor targets because of where they are and the and they would have to write a report metropolitan access they provide. indicating they are in favour of one or two projects going ahead in adcept, a 300-unit, 25-storey micro-condo building at 902 Davie Street in Vancou- vance of the detailed research which ver’s Downtown. The NMDA-design would include units ranging in size from 175 will be needed on how these actualsquare feet to 275 square feet and common spaces on every floor, such as com- ly pan out.” A report to Council from munal dining areas, gardens and study halls. If approved, the smallest of the the city’s Chief Housing Officer on the minimum unit size bylaw is exunits would be vying for the title of Canada’s tiniest condo.

The frustrations of Reliance president Jon Stovell with the City are well-docu- pected later this year. When asked if mented. Quoted in a 2014 Vancouver Sun article, he refers to the City’s progress on micro-condos are years away from bethe minimum unit size bylaw and the micro-condo issue in general as “glacial.” A for- ing constructed in Vancouver, Jackson mal application for the Davie Street project has not yet been submitted in light of the replies simply, “Yes.” b building.ca

BLD Jun-Jul 15.indd 19

15-07-02 2:24 PM

20

Boomers will trade square footage for luxury

Boomers will work for the rest of their lives

Boomers want peace and quiet

WHO DON’T WANT THEM Boomers want lots and lots of storage

Boomers want lots of parking

Millions of Boomers are migrating to multi-family homes. What can we build to make them happy? av

By D

JUNE JULY 2015

BLD Jun-Jul 15.indd 20

id All

ison

building.ca

15-07-02 2:24 PM

M

We’ve all heard the stories over and over little or no home equity, and are in need of MFH housing opagain: the largest and most moneyed tions that take this into account. The answers for this group demographic, the Baby Boomers, have are so unique and specialized (Co-housing? Life-leases?) that the power to create markets in any industry. So when the the mainstream building industry will be hard-pressed to Boomers start eyeing multi-family housing (MFH) as an alserve them well with any kind of profitable volume. That leaves 50 per cent in the middle of the Boomer pyramid who ternative to the Golden Sunset Retirement Village — and a are The Reluctants: eight million in Canada, give or take potential market of millions of homebuyers is identified — a million or two. If even 25 per cent of that group are it’s big news. searching for MFH solutions they can afford and that It’s happening now. And the best news? There’s an unBoomers control 70% solved riddle with many possible solutions in this mass make them happy and proud, that’s a big market. of all dismigration from the single-family home to denser MFH built Here’s the rub: imagine being one of The Relucposable income tants. The market you want to live in is overflowing forms, solutions that will keep the residential building inwith condo developments, but they all seem to be dustry profitably occupied for decades to come: how do we built for either first-time homebuyers or The Affluenbuild MFH for Boomers who don’t want them? tials. You can choose between a tiny suite in a very upscale We all know someone who has a single-family home that building, or a more reasonable floor plan in a building filled they’ve spent a lifetime paying for. The mortgage-burning with part-time DJ’s and a weekly keg party down the hall. It’s party was 10 or 15 years ago, at which point they reached not much of a choice. one of the most significant milestones in contemporary culThis might sound like a thumbnail sketch based on rough ture: a debt-free home. Problem is, the house is also the renumbers and ballpark estimates. But that’s largely the point. tirement plan, either by choice or circumstance, and now as We don’t have accurate information on this group. We all they retire they must sell the family homestead and look at know people who fit this profile, but we aren’t, as an indusdownsizing. But they don’t want to sell the house. They are try, building for them. grumpy about it. And the grumpiness turns to outright crabbiness when they start shopping and see what Boomers kind of condo or apartment they can afford, and still SO WHAT DO WE DO? will inherit $15 trillion pocket enough money to fund a retirement lifestyle.

A survey of 1,000 Boomers who have lived in MFH for in the next Granted there are exceptions galore. Some Boomat least five years in cities across North America point20 years ers saved enough money to stay put. Others decide to ed to some broad answers. First, Boomers are clear that keep working to make ends meet in a more merry way. this emotional, anxiety-laden time in their lives is not Still others who won the career lottery and find themselves really about our product at all. It was about them. The Boomwith enough cash to do whatever the heck they like are sellers have famously been referred to as the Me Generation, so ing the house with no small amount of glee, and moving it’s not a surprise that the MFH issues they are grappling with to luxury condos in the sky with a concierge, marble bathare largely inward-facing. They see the single-family home rooms and a wine cellar. they are selling as an impressive, hard-won trophy on the fireHowever a significant percentage of the Boomer populaplace mantel, and it will soon be gone. They worry what their tion — let’s call them The Reluctants — do not want to move friends will think (“Gee, Bob and Sally had to sell the house.

Wow. Had no idea they were in trouble.”) and they worry about to MFH, but have no choice. And that’s where the opportunfitting in (“What if the people in this condo building don’t like ity is. How do you make The Reluctants happy? How do you us? That guy on the elevator had a pierced cheek? How does he build homes that make them feel like winners, not losers? chew?”). Yet, if you look at most of the condo marketing messages the building industry sends out to the market, they are HOW MANY ARE WE TALKING ABOUT? extremely product focused. Of course Reluctants want to There are roughly 16 million Boomers in Canada. Now, know about the product, but more importantly they want to using really broad strokes, let’s say 25 per cent of the total know how everyone is going to think about them inside that is what we could call The Affluentials: these are the ones product. A better job needs to be done to reassure them. who want Baccarat chandeliers and six-burner GE MonoSecond, Boomers are social animals and peer group acgram ranges in the kitchen. The building industry knows ceptance is a huge motivating factor. Boomers are scared how to look after these ones. In every city there are examsilly that their existing peer group will ditch them like the ples of condominiums built for The Affluentials that are unpopular kids on the playground once they leave the selling/have sold lickety-split.

Boomers old ‘hood behind. Survey’s show that the most importThen let’s assume there are another 25 per cent on are not the needle ant rooms in a condo or apartment are the living room, the bottom of the Boomer pileup who have no savings, in the haystack >

BLD Jun-Jul 15.indd 21

15-07-02 2:24 PM

Boomers are the haystack

THE FLIP SIDE: GEN XERS WANT WALKIN CLOSETS, ENERGY-EFFICIENCY AND WIFI IN THEIR NEXT HOME

dining room and kitchen, a.k.a. the Show Off Triangle. It makes sense: friends and family who are over for a visit will spend all their time in these three rooms. So let’s tart them up and make them brag-worthy. Maybe we take some money out of the spa-like Results of an inaugural survey of recent new home buyers across Canada by Avid bathrooms (which scored low on the Ratings Canada in partnership with the Canadian Home Builders’ Association Boomer list of important rooms) and (CHBA) illuminate nationwide trends in current home buyer preferences across add a feature wall in the dining room, or seven customer segments, including: single/couples without children; growing more millwork in the living room. Some family with children; downsizing family; semi-retiree/retiree seeking a mixed-age kind of remarkable lighting technology community; semi-retiree/retiree seeking an age-restricted community; invesor a fancy ceiling treatment might help tors; and second/vacation home buyers. here too. The possibilities are endless Over 12,000 home buyers were surveyed, uncovering some interesting charbut the point is this: don’t deliver boracteristics. Nearly half of today’s home buyers (46 per cent) are comprised of ing living and dining rooms. This group Generation X with Generation Y (Millennials) following closely at 38 per cent. uses those rooms to project their sucBased on the data, in today’s market single couples with no kids is the largest cess, and needs our help to do that. cohort buying new homes. While 35 per cent of respondents would prefer a Third, storage is a huge opportunity single-family detached 2-storey home for their next house, surprisingly the largand a huge issue. Boomers are coming est item buyers are willing to compromise on to reduce the cost of their next from large homes in the suburbs with a home is the size (22 per cent); none of the respondents would compromise on lifetime of belongings in tow. It’s been quality or energy efficiency. said that you will have one set of dishes 85 per cent of Canadian home buyers begin their home buying search for every decade you have been on the online, with every age group using it to begin their search. Social media Boomers planet, so these buyers need storage is the second largest trend, with 52 per cent using it as a resource love old for five or six sets of dishes. They world media to find their next home; the younger they are, the more they actively like print don’t want those going in the cage in engage with marketing on social media. That being said, every age and TV the parkade with the bare light bulb group is relying on the virtualization of model homes and product in the ceiling. Where do the family reviews to find their next home, with 86 per cent of buyers considerphoto albums go? Why did we all stop ing virtualization of model homes as an important tool and 89 per cent using including linen closets in condos when online customer reviews to make their home buying decision. they only take up two square feet of In 2014, walk-in closets and energy-efficiency dominated the “must-have” space? What about the Christmas deco­ list for new homebuyers. Over two-thirds (68 per cent) of consumers considrations and grandma’s china hutch? We er walk-in closets as a non-negotiable feature in their next need to find ways to think about storage home, with an equal number of buyers highlighting energyinside and outside the suites in a David Allison is the efficient appliances as their most important “must-have.” way that resembles what boat founder of B/A Boomers For mid- and high-rise buildings, 24-hour security, WiFi builders do: ingenious uses of Marketing Buildings, a celebrate throughout the building, and an in-building health and gym indivduality every nook and cranny.

Vancouver-based global but want club are the largest sought after components. The national We can address many of the real estate development to belong survey showed that 43 per cent consider 24-hour security as surface-level fears on a casebranding and marketing a “must-have,” and 42 per cent consider building-wide WiFi by-case basis. More storage can firm that works with at the top of their list. be designed, more parking can be ofdevelopers/owners in the Health and wellness concerns top the list of commufered. More useful amenity spaces can residential, recreational, nity preferences as well, with walking trails, bike paths, be created. But unless we find a way to commercial, industrial parks and recreation being cited as the most sought after help buyers feel better about this enorand bare land sectors. amenities. Leading the way are walking and bike paths, mous change in their life, we will alHe can be reached at with over half of buyers noting these items as their largways be selling against an unspoken david@ est want for a new community (53 per cent). Parks and objection. While it might not be much marketingbuildings.com. recreation centres follow closely with 46 per cent considof a ground-breaking revelation, it is His third book, The ering them a “must-have.” Overall, landscaping rounded something we should be talking about Stackable Boomer is out the list with 41 per cent of buyers wanting move-in as an industry. Change is hard, how available at www. ready, fully landscaped communities. can we help make it easier. b marketingbuildings.com

22 26

AUGUST JUNE JULY SEPTEMBER 2015 2013

BLD Jun-Jul 15.indd 22

building.ca

15-07-02 2:24 PM

JUST ANOTHER CASE OF WINDOW ENVY.

allweatherwindows.com/builder

Scan the QR code to find out why we stand out from the crowd, and don’t be surprised if your job site attracts more attention.

OFFICIAL PARTNER

000907.27.04.15

PIONEER STEEL BUILDINGS Pioneer Steel has been manufacturing steel buildings in Canada since 1980. Our premium quality, preengineered steel buildings have been in use for a wide range of industrial, commercial, residential, agricultural and recreational applications.

Pioneer’s clear span, no trusses, no beams, no posts designs are today’s leading edge steel building solution. You’ll get 100% usable space that’s affordable, eco-friendly, easy to install, maintenance-free, weather and storm-resistant and, above all, long-lasting.

Where does purple fit into your design?

800-668-5422

www.walltite.com

Client: BASF

Project: Where does purple...

4222_Walltite_TeaserAd_FINAL-BM.indd 1 Date: Mar 12 2015 Designer: JM

Publication: Building Magazine Size: 3.5” x 2.24” Bleed: Colour: CMYK

Dryvit introduced the concept of combining both Continuous Insulation (CI) and design- flexible aesthetics into a single exterior wall system, and called it “Outsulation.” Over half a million buildings later, Outsulation systems are a trusted choice for architects, building owners and contractors who want a high performance, insulated cladding solution that can provide everything needed from a building code perspective, and all that is desired from an aesthetic standpoint.

STEEL BUILDINGS SINCE 1980

Agency: ON Communication Inc Agency Contact: Raellen Seaman2015-03-12 Telephone: 519-434-1365 xt 228 Email: raellen@oncommunication.ca

PIONEERSTEEL.CA

10:53 AM

SLIM FLOOR STRUCTURES Peikko is the specialist of fastening technology for concrete constructions and composite beams for slim floor structures. Customers worldwide are served through Peikko offices in more than 30 countries. www.peikko.ca

For more information call 1.800.263.3308 e-mail info@dryvit.ca or visit dryvit.ca

BLD Jun-Jul 15.indd 23

15-07-02 2:25 PM

Getting Around Earlier this year, the Canadian Centre on Disability Studies (CCDS) in Winnipeg launched a three-year national initiative called Collaborative Knowledge Building and Action for VisitAble Housing in Canadian Cities Project (otherwise known by the much-shorter title “VisitAbility Project”). This project, funded by the Government of Canada’s Social Development Partnerships Program — Disability Component, is a movement that has at its core the incredibly ambitious goal of changing home construction practices so that virtually all new homes offer a few basic accessibility features that make them easier for people with mobility difficulties to live in and visit.

While no one likes to have to think about the mobility issues they will face as they age (after all, as David Allison notes in his new book The Stackable Boomer, while their bodies may disagree, in their heads Boomers still think they are 35), this is a growing issue facing all forms of real estate de-

By Peter Sobchak

vast majority of adults aged 55 or older (89 per cent) want to age in their own home, but over 50 per cent of falls that older adults suffer occur in their own home. Stairs are the leading cause of serious falls among community-living elderly, accounting for about one-third of all fatal falls, and a common reason that seniors move from their home is their mobility problems. But studies have shown that seniors are less likely to move to an institution or care home when their homes are equipped with some accessibility features.

This is where efforts such as VisitAbility come in. First introduced in North America in 1986 by Eleanor Smith and a group of advocates for people with physical disabilities, the vision of the VisitAbility movement is to create an inclusive community where people with mobility challenges can visit their families, friends, and neighbours without barriers. Although there are a few interpretations of VisitAbility, three essential features are commonly identified for VisitAble housing, and include: a no-step entrance

Place La Charrette is the only housing project in Winnipeg that has universally designed apartments and attached bungalow units on the same property, and is not only accessible but also affordable with rental rates geared towards low- to medium-income households.

velopment. Statistics show that one in six Canadians (14.3 per cent) has a physical disability, and one third of all Canadians aged 65 years or over have mobility problems. This cohort of adults aged 65 and over is an interesting one as it relates to this growing issue: they currently account for 14.1 per cent of the Canadian population, but will number more than one-fifth of the population by 2026 and one-quarter of the population by 2056. Which means their living patterns and desires will affect all levels of the development industry. For example, the JUNE JULY 2015

BLD Jun-Jul 15.indd 24

(at the front, back or side of the house); wider doorways and clear passage on the main floor; and a main floor bathroom or powder room that can be accessed by visitors who use mobility devices.

BEYOND THE MINIMUM

Progress is being made in advancing VisitAble housing in regions such as the United States, Australia, the U.K. and other European countries, but Canada is lagging behind those countries in terms of legislation, incentives and public education. To combat this, one component of the Project was the initiation of the Awards of Excellence in VisitAble Housing. The winners

Images: Ten Ten Sinclair Housing/ Clay Construction/ Cynthia Street

With a rise in the number of aging Canadians will come a parallel rise in mobility issues, something the residential sector is typically slow to react to. A new awards program is aiming to combat that.

24

building.ca

15-07-02 2:25 PM

(full disclosure: I was one of the judges) reflected several building types that not only integrated the three main provisions for being considered “visitable,” but went further in their solutions to address the challenges disabled people face in the built environment.

The first prize winner in the Multi-Family Unit Development category, Place La Charrette in Winnipeg raised the bar on accessibility issues, and not just through design. Developed and managed by Ten Ten Sinclair, a non-profit organization that develops affordable housing for persons with physical and reasonably equivalent disabilities, the project required extensive collaboration between public and non-profit sectors, with the total project cost of nearly $11 million cost-shared between the Province of Manitoba and the Government of Ca­ nada. These partnerships facilitated

Living, this home was built for a woman who has life-threatening multiple chemical sensitivities compromising her immune-system, which meant in addition to accessibility, air-quality was paramount. This project called for innovative solutions within a tight budget, and along the way notched up Energuide 94, R2000 certification and BuiltGreen Platinum ratings.

Receiving special recognition in the Awards was a heritage project that impressed the jury in the efforts it took to overcome visitability issues in a building that was built in a time when no such considerations were given. Government House, home to the Nova Scotia Lieutenant Governor, is a highly visited residence, but until recently was not universally accessible. Wheelchair access was limited to the ground floor. Clearly an elevator to provide accessibility to all floors was needed, but the existing plan and heritage structure did not lend itself easily to such a solution. As a heritage building, attention needed to be given

Platinum Living is a small home with a simple design that matches the character of the neigh­bourhood and adheres to rigorous green principles necessary for an occupant whose extreme chemical sensitivities will eventually render her disabled.

25

A three-year renovation of Government House, home to the Nova Scotia Lieutenant Governor, included installation of an elevator, accessible washrooms and paths of travel to overcome the heritage structure’s accessibility limitations.

to character-defining features so that they were not inadvertently removed or irreversibly altered. Space was tight in the attic and the only feasible location would displace an existing servery, washrooms, and a Maid’s Room. A high water table was problematic, as well. Yet despite these setbacks, the end result of a three-year renovation included installation of an elevator, accessible washrooms and paths of travel. While not every box on the accessibility checklist was crossed off, the jury felt that this project makes a strong public statement about the need to address all structures, including heritage ones, from the perspective of visitability and inclusivity. b

an Integrated Design Process between Manitoba Housing, the architect, contractor, a universal design expert, and tenants with manual and electric wheelchairs. As a result, Place La Charrette is the only housing project in Winnipeg that has universally designed apartments and attached Go to VisitableHousingCanada.com for the full list of the Awards of Excellence winners, bungalow units on the same property. and see how the Canadian Centre on Disability Studies is working to spread the gospel The first prize winner of the Single Family of VisitAble housing standards and legislation across Canada.

Detached Homes category didn’t have the benefit of government intervention, but still managed to raise the bar on every level of design. Rightfully called Platinum building.ca

BLD Jun-Jul 15.indd 25

15-07-02 2:25 PM

28 26

Up,

C

y a w A d n a Up

Canada’s lodging real estate market continued its momentum in 2014, marking the fourth consecutive year of investment of over $1 billion.

anada’s hotel real estate market continued its strong momentum in 2014 with total transaction volume reaching $1.46 billion, growing 28 per cent year-over-year. Investment activity was aided by debt sources eager to finance acquisitions as well as a diverse group of buyers and sellers motivated to take advantage of ideal market conditions, including buy-side demand from cross border groups— most notably Mainland China. The increased presence of institutional players and other non-traditional buyers helped fuel the market into its fourth consecutive year of investment of over $1 billion.

The market was flush with activity and supported by an elevated level of competition by a variety of buyer groups with 127 trades reported for the year, up 10 per cent from the 115 trades reported in 2013. This compares with a low of 74 trades at the bottom of the investment cycle in 2009. Key deal metrics were generally in-line with 2013 results, indicative of overall healthy pricing and momentum moving into 2015.

Average price per room was $93,200, six per cent below 2013 while average deal size remained largely the same at $11.5 million. A growing mix of Canadian, U.S. and international lenders actively pursuing

JUNE JULY 2015

BLD Jun-Jul 15.indd 26

By Fraser Macdonald opportunities to fund hotel acquisitions aided larger deals with 2014 seeing the greatest amount of large single asset transactions since the last peak in 2007, with 14 deals trading above the $25 million threshold.

Full-service assets dominated in Vancouver 2014, accounting for 52 per cent of volume totaling $750 million with an average price per room of $98,500.

Victoria Full-service activity was generated by sellers strategically disposing and taking advantage of market timing. Focused-service assets continued to peak investor interest, representing 27 per cent of volume ($391 million) and were acquired largely for in-place yield, with swift competition for well-located assets helping to grow average price per room to $122,400, the highest of all segments. Limited service activity comprised the remaining 22 per cent ($314 million) in deal volume which was driven largely by private investors with intuitional and public companies being a significant component of this on the sell-side by divesting non-core assets.

Western Canada Leads on Pricing Hotel trading activity was split fairly equally between Eastern (49 per cent) and Western (51 per cent) Canada. Following historic trends, Western Canada led in per room pricing metrics reaching a 45 per cent premium over Eastern Canada. While the Northwest Territories had the highest average price per room, trading volume was the result of one

COLLIERS’ 2015 HOTEL INVESTMENT FORECAST CALLS FOR ANOTHER STRONG YEAR OF BETWEEN $1.25 BILLION TO $1.5 BILLION IN DEAL VOLUME

building.ca

15-07-02 2:25 PM

y Major city transaction volume

27

2013 2014 % $M $M change Toronto

449.8 273.5 -39

Vancouver

75.3 193.6 157

Calgary

71.5 88.3 23

MontrĂŠal

65.5 82.3 26

Ottawa Edmonton

139.5 68.7 -51 69.3 63.5 -8

Vivtoria 37.0 48.0 30 Halifax

70.0 34.8 -50

Edmonton Calgary

Halifax

ctoria

MontrĂŠal Ottawa

Source: Colliers International Hotels

trade and represented just one per cent of overall results.

On a provincial level, Ontario continued to lead the country in terms of deal volume and number of trades ($505 million, 49 trades), followed by British Columbia ($349 million, 23 trades) and Alberta ($328 million, 27 trades). On a local level, Toronto maintained its spot as the largest hotel investment market with $273.5 million in recorded deal volume, followed by Vancouver ($193.6 million), Calgary ($88.3 million) and MontrĂŠal ($82.3 million).

Diversified Mix of Buyers and Sellers While private capital from private investors, real estate companies and hotel investment companies has traditionally comprised the most significant and consistent component of investment flow, the Canadian lodging industry is experiencing sustained investment acceptance from an increasingly diverse range of domestic institutional capital which has elevated the transaction environment into a consistent $1 billion+ market. This trend is expected to provide continued liquidity and increase the level of capital attracted to the hospitality sector over the medium-to-long term.

On a deal volume basis, private investors were the most active in 2014, accounting for $434 million or 30 per cent of buy-side transaction volume, compared with $317 million or 25 per cent of volume in 2013. Activity from private in-

Toronto

vestors has always been a consistent component of the market accounting for the bulk of trades and averaging $310 million per year since 2009. Real estate companies were the second largest buyer group representing 21 per cent of overall volume, driven primarily by land motivations for eventual redevelopment, conversion to alternate use or diversification of their real estate portfolio. The largest acquisition from real estate companies was the dual-branded Courtyard & Residence Inn by Marriott Calgary Airport for $66 million ($210,200 per room).

Buy-side activity from public companies accounted for 21 per cent of deal volume ($299 million), increasing from $172 million in 2013 and was primarily driven by Temple building.ca

BLD Jun-Jul 15.indd 27

15-07-02 2:25 PM

DEAL VOLUME REACHED $1.46 BILLION IN 2014, REPRESENTING 28 PERCENT YEAR-OVER-YEAR GROWTH.

28

Transaction volume by region # of hotels

# of rooms

$ volume ($M)

% volume

Price per room

Alberta

27

3,175

$328

23

$93,700

British Columbia

WEST

23

2,467

349

24

135,600

Manitoba

3

54

7

0

75,700

NWT

1

106

22

1

204,500

Saskatchewan

2

273

36

2

146,400

56

6,075

742

51

(114,900)

West Total - (Average)

Ho

EAST Ontario

49

5,796

505

35

88,200

Quebec

13

2,276

156

11

68,400

Nova Scotia

5

773

38

3

49,600

New Brunswick

2

136

9

1

67,200

Newfoundland

2

109

6

0

52,500

East Total - (Average) Overall Total - (Average)

71

9,090

713

49

(79,100)

127

15,165

1,455

100

(93,200)

Rea

THERE WERE 127 TRADES REPORTED FOR THE YEAR SPLIT ALMOST EVENLY BETWEEN EASTERN AND WESTERN CANADA

Looking ahead in 2015 The theme throughout the current up-cycle has been increased investment in hospitality assets by domestic institutional investors. As debt capital costs remain at an all-time low and competition for other real estate assets remains robust, the hospitality sector should continue to see a variety of capital sources that have an established platform, as well as new entrants into the market.

Hotels Inc. as well as InnVest REIT, Canada’s largest hotel REIT which acquired the Hyatt Regency Vancouver for $140 million ($217,000 per room). Other institutional-level groups were active in major urban centres such as Toronto, Calgary and Halifax, representing 14 per cent of deal volume.

Hotel investment companies continued to be motivated by opportunistic turn-around deals across the country, accounting for 14 Significant single asset transactions in 2014 by volume per cent of trading volume but 25 per Property Seller Buyer cent of number of rooms sold. These Hyatt Regency Vancouver Hyatt Hotels Corporation InnVest REIT types of companies have historically been strategic in hotel investments Park Hyatt Toronto Hyatt Hotels Corporation Oxford Properties Group commonly timing the market and acCourtyard & Residence Inn Mitchell Group Remai Group quiring properties at a lower price per

by Marriott Calgary Airport room and repositioning with capital Holiday Inn Montreal Midtown Rosdev Group Beaumont Parters SA (65%) & Campus Crest (35%) and other value-add opportunities.

The Fairmont Empress Hotel Ivanhoé Cambridge Bosa Development While hotel investment in Canada has historically been over 90 per cent Fairmont Château Montebello Oxford Properties Group Evergrande Group domestic, there has been growing inTop portfolio transactions in 2014 by volume terest from foreign-based groups beEaston’s Hotels Select Service Portfolio Easton’s Group of Hotels Temple Hotels Inc. hind the scenes, often contending as Canadian Delta Portfolio InnVest REIT Delta Hotels & Resorts strong second and third place bidders on prime hotel and resort offerings. In Limited Service Thunder Bay Portfolio Harboursite Ltd. Temple Hotels Inc. 2014, foreign-based buyers accounted for 15 per cent of volume with purchasComfort Inn Portfolio InnVest REIT SunRay Group er origin from Europe, Asia and the U.S. JUNE JULY 2015

BLD Jun-Jul 15.indd 28

building.ca

15-07-02 2:25 PM

#o

2014 buyer composition % of volume

14% 14% 21%

• Colliers International Hotels forecasts transaction volume of $1.25 and $1.5 billion in 2015, supported by strong pipeline and deal momentum.

• The decline of Canadian currency relative to the U.S. dollar is becoming increasingly attractive to cross-border groups and should help influence those considering investing in Canada. In addition, the flow of Canadian capital into the U.S. property market should weaken as the U.S. Greenback has materially appreciated; increased focused on deploying funds within Canada will likely transpire.

Hotel Investment Co.

Institutional

•C hinese capital will form an expanding component of the overall buyer mix as there is a growing propensity of Chinese capital to invest in stable markets like Canada. This is supported by the recent easing of restrictions on investing outside of the Mainland.

KEY DEAL

Public Company

21%

METRICS WERE GENERALLY IN-LINE WITH 2013 RESULTS, INDICATIVE OF

30% Private Investor

# of keys

• The recent trend of hotel properties converting to alternate use may not be over in major markets as the Canadian residential market remains very robust and a variety of older hotel assets are ripe to be converted/redeveloped.

OVERALL HEALTHY PRICING AND MOMENTUM MOVING

Real Estate Company

29

INTO 2015.

• BMO Capital Markets Economics Research updated their WTI Crude Oil forecast in late February 2015 with a forecast of US $52.00 per barrel in 2015 and US $65.00 per barrel in 2016, significantly below the US$100+ seen in the first half of 2014. It is expected investment sentiment will moderate in oil dependent markets.

• I n 2014, annual RevPAR growth surpassed the height of the previous cycle, registering a 6.2 per cent increase year-overyear according to PKF Consulting. While there remains good runway for additional operating performance, we expect oil and gas markets in Western Canada to dampen full-year 2015 gains. b

Buyer origin

Fraser Macdonald is a research analyst at Colliers International Hotels, an international real estate investment advisory company, specializing in the lodging industry with knowledge and experience extending across all hotel and resort asset classes.

Price ($M)

Price per room

Cap rate (%)

Additional Details

644

$140

$217,000

n/a

Canadian

346

105.0

303,500

n/a

Canadian

Purchaser plans to invest US$25M in renovations.

328

66.0

201,200

n/a

Canadian

Includes approximately one acre of excess land.

488

65.0

133,200

n/a

European

Hotel sold for conversion to student residences.

477

48.0

100,600

n/a

Canadian

211

n/a

n/a

n/a

Chinese

257

43.0

167,500

9.3

Canadian

Sold as two property portfolio (Sudbury & Mississauga)

792

n/a

n/a

n/a

Canadian

Sold as three property portfolio (one in Calgary and two in Halifax)

184

26.1

141,800

9.0

Canadian

Sold as two property portfolio. Cap rate based on forecasted 2014 - 2015 financials.

273

11.4

41,800

n/a

Canadian

Sold as three property portfolio (Chatham, Dorval and Pointe Claire).

building.ca

BLD Jun-Jul 15.indd 29

15-07-02 2:25 PM

30

V I E W Walk with Joy ULI Toronto’s Executive Director questions those who pave over a city’s front yard paradise

By Richard Joy

There are a few urban obsessions that gnaw at me — backpacks on the TTC, for example — the worst being the steady erosion of green space and tree canopy of neighbourhood streets. And it has turned me into a bit of a vigilante.

Earlier this spring on my morning patrol of my neighbourhood with my faithful Labradoodle, Ira, I took to tweeting front yard photos of neighbours who recently paved over their entire frontages or critically damaged the roots of mature city trees in the name of landscaping. I was alarmed at how many examples I was able to find within a few short blocks of my house.

Concerned as I was of the brazen contempt of by-laws designed to protect our urban greenspaces, the response from institutional Toronto was even more distressing. From the city to our guardian environmentalists, no one seems to care about what is arguably the most preventable source of pollution contaminating our urban environment. Excess storm water regularly floods our sewers causing failure of critical transportation, transit and energy infrastructure. Much of this toxic runoff ends in ecologically sensitive creeks and rivers and dumps into the lake. While some is captured in a 1990s-built storm water holding tunnel, the expense of treating and incinerating this sludge is considerable as well as an atmospheric issue.

A series of escalating email and phone exchanges with my local councillor led to a multi-departmental meeting of the three city departments responsible for protecting our front yards: Forestry, Works, and Buildings. Intended to plug intercity jurisdiction gaps, the meeting exposed a gong show of by-laws and bureaucracy run amok: only one forestry inspector for the entire South District (Toronto & East York) to police both front and backyard trees from harm or removal; Forestry can expect no help from Buildings, not even to report whether a required tree protection zone has JUNE JULY 2015

BLD Jun-Jul 15.indd 30

been erected around trees within a construction site; Works department (responsible for enforcing by-laws for the city portion of front yards) has carte blanche powers of discretion over the most ambiguous of policy intentions that favour those who pave over paradise.

I used to blame the influence of suburban politicians for the proliferation of driveway widenings and other intrusions of hard paving over soft landscaping in our urban neighbourhoods. So I was surprised to learn that Mississauga has taken the lead on this issue. Rejecting the byzantine brew of by-laws and departmental jurisdictions that Toronto has, Mississauga’s new landscaping policy is simple: “Property owners will be charged based on the amount of hard surface area on their properties. The more hard surface you have, the more water runoff you are creating and the more you will be charged. The less hard surface you have, the less you will pay.” Makes sense. Property owners who allow more run off, cost the city more, and thus will pay more. To avoid the tax, property ownRichard Joy is Executive ers can remove unnecessary hard pavDirector of ULI Toronto.

Previously, he served as ing. Mean­ing Mississauga will not only Vice President, Policy and halt over-paving, it will reverse it.

Tackling excessive storm water runGovernment Relations at off is more than a local pollution issue; the Toronto Board of it is a pressing environmental concern Trade, and was the that is rising to the forefront of the enDirector of Municipal tire Great Lakes watershed. For examAffairs and Ontario ple, last summer the water supply of (Provincial Affairs) at the entire City of Cincinnati was poiGlobal Public Affairs. soned beyond a boil water order. ToronFollow him on Twitter to has a proud history of changing be@RichardJoyTO or email haviours that negatively impact our at Richard.Joy@uli.org environment and quality of life, from garbage to water usage to energy consumption. It is now time that it shows the same leadership on storm water runoff. And that will free me up to tackle the TTC backpack scourge. b

building.ca

15-07-02 2:25 PM

71103

INDUSTRIAL | COMMERCIAL | RECREATIONAL | INSTITUTIONAL

High Quality

EXPERT ADVICE Improving Your Bottom Line

Cost-efficient building solutions As experts in pre-engineered steel buildings, we’ll help you find the right solution for your budget. Our on-staff engineers insure the construction of your BEHLEN project is timely, efficient and built with high-quality products that last.

GET YOUR PERFECT FIT. (888) 315 -1035 | www.behlen.ca © BEHLEN Industries LP 2014

71103 BEHLEN Builder Ad - Bld Mag - 8x10.75 V2.indd 1 BLD Jun-Jul 15.indd 31

2014-03-07 3:23 PM 15-07-02 2:25 PM

Build bold.

TM

She wrote the e-book on confidence.

Where are homeowners with a passion for personality finding fascination these days? In exteriors bathed in deep, beautiful hues.

It’s a movement driven by a strong impulse to look up and see their very cool home in all its colourful glory. We have just the thing to match this trend: exteriors with character that come in a rich palette of dark colours. We’re very confident about that. royalbuildingproducts.com Featuring Royal® Siding, Trim and Shutters

See how unboring colour and texture can be with our online design tool. homeplaybyroyal.com.

© 2015 Royal Building Products

BLD Jun-Jul 15.indd 32

15-07-02 2:25 PM