real estate development
building.ca February March 2018 CDN $4.95
Finding Success with Public Art* *
means different things to different groups
+ BLD FebMar 18.indd 1
BIAs as city builders Bitcoin mining farms
2018-02-02 3:16 PM
The smartest way to build a home.
Owens Corning Building Scientists continually research and develop smarter ways to build better homes, creating complete building and insulation solutions that lead the industry in performance, durability and safety. These forward-thinking designs are not only proven to perform, but they also deliver meaningful benefits your homebuyers will be willing to pay for. Let us show you how to Turn Building Science into Building Genius™. Ask your Owens Corning Area Sales Manager to connect you with the Owens Corning Building Science Team, or call us today at 1-800-GET-PINK®. For more info and insights from building industry experts, check out our online community at www.highperformancebuildingexchange.com
Better homes through science. THE PINK PANTHER™ & © 1964–2016 Metro-Goldwyn-Mayer Studios Inc. All Rights Reserved. The colour PINK is a registered trademark of Owens Corning. Personality rights of ALBERT EINSTEIN are used with permission of The Hebrew University of Jerusalem. Represented exclusively by Corbis. © 2016 Owens Corning. All Rights Reserved.
BLD FebMar 18.indd 2
2018-02-02 3:16 PM
LIFE AFTER THE BACK COVER…
what’s on BUILDING.ca
READ > New Year, New Laws Daoust Vukovich LLP discusses various 2018 legislative developments impacting commercial property leases.
11 > Art in Condoland /
Development mania across Canada is marked by eye-catching public art. But what makes such works successful? No one, it seems, can quite agree. By Chris Hampton
EXPLORE > Williams Parkway Operations Centre RDHA brings a new typology to an otherwise typically dull municipal operations centre.
18 > A Path to the Table /
BIAs, the Data Revolution and City Building. By Stefan Novakovic
23 > What’s Coming, What’s Here, and Do We Care? / CRE executives have significant reservations about emerging disruptive technologies. By Michael Crook
26 > Accommodating the Disruptors /
EXPLORE > 7 St. Thomas Hariri Pontarini Architects’ new project blends Victorian and contemporary materials.
To become a tech hub, cities need wages and talent, not just sexy buildings.
IN EVERY ISSUE
05 > Editor’s Notes 06 > Market Watch 08 > Legal 28 > Site Visit 30 > Viewpoint
Wonderland (2008– 12), by Jaume Plensa, a massive wire head public sculpture outside the Bow Building in Calgary.
BLD FebMar 18.indd 3
2018-02-02 3:16 PM
Create a blueprint that reduces your carbon footprint Commercial Savings by Design is a free program that helps you incorporate energy savings into your building design. Through an Integrated Design Process, you have exclusive access to Canadian green building experts who can help your team identify ways to drive long-term eﬃciency in current and future developments. Identify clear and cost-eﬀective strategies to achieve sustainability goals above Ontario Building Code
Integrated Design Process where you will receive exclusive access to Canadian green building experts in a free visioning session and design workshop
Green building innovation and implementation expertise increasing your team’s knowledge for future projects
Long-term eﬃciency and energy savings for building occupants
Start saving by design uniongas.com/csbd
01 Number Editor / Peter Sobchak Art Director / Roy Gaiot Assistant Editor / Stefan Novakovic Legal Editor / Jeffrey W. Lem Contributors /
Michael Crook, Chris Hampton, Richard Joy, Megan J. Lem, Shannon Moore
Customer Service / Production Laura Moffatt 416 441 2085 x104 Circulation Manager email@example.com Sales Manager Faria Ahmed 416 441 2085 x106 firstname.lastname@example.org Vice President & Senior Publisher / Steve Wilson President, iQ Business Media Inc. Alex Papanou Building magazine is published by iQ Business Media Inc. 101 Duncan Mill Road, Suite 302 Toronto, ON M3B 1Z3 (416) 441 2085 x104 • email@example.com 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 $20 US overseas. Please send prepayment to Building, 101 Duncan Mill Road, Suite 302 Toronto, ON M3B 1Z3. Subscription and back issues inquiries please call (416) 441 2085 x104, e-mail: firstname.lastname@example.org or go to www.building.ca Please send changes of address to Circulation Department, Building magazine or e-mail to email@example.com 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)
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.
H.S.T. #80456 2965 RT0001 ISSN 1185-3654 (Print), ISSN 1923-3361 (Online)
iQ Business Media Inc. Canada Post Sales Agreement #43096012
Got a Light?
2018 will be an interesting year, if the clouds on the horizon are any indication. But they’re not storm clouds, exactly: they’re clouds of pot smoke. As we all know, this year will see new federal legislation decriminalize the possession and distribution of marijuana and permit the retailing of cannabis by the provinces and territories. In Ontario, for example, the LCBO will be responsible for selling recreational weed, and plans to set up 150 stand-alone cannabis stores by 2020 with an initial 40 stores opening in 2018. Not surprisingly, there is resistance on multiple fronts, including some municipalities that have voiced concerns about the impact of legal marijuana shops in their area. The City of Richmond Hill, north of Toronto, is one of them, having unanimously endorsed a statement saying it was not willing to host a cannabis retail establishment (after allegedly being notified by the LCBO in late November that they were being considered as a potential location), citing the associated costs of policing as one of the reasons. Perception is everything, and let’s face it, marijuana still carries a pungent stigma. But how justified are Richmond Hill’s concerns? Christopher Alexander, Re/ Max’s regional director for Ontario-Atlantic Canada region, says having a marijuana retail location in the area could potentially reduce criminal activity by providing a legal channel to buy pot. “Crime should come down, which always has a positive impact on real estate prices,” he said. Crime is obviously a concern to any municipality, but it’s Alexander’s second point that should also catch their attention. Interestingly, a U.S. study has come out suggesting that recreational pot could actually lift property values. Professors from the states of Wisconsin, Georgia, and California found that property prices for homes in Denver, Colorado (the state all cannabis advocates point to as a success story) near shops which converted from medical marijuana to recreational pot in 2014 saw values increase by 8.4 per cent, compared to those slightly further away. The study’s authors say the impact of a store’s conversion from medical to recreational pot on house prices was “highly localized.” The study used publicly available data to compare the prices of single-family homes within a 160-metre radius of the cannabis shop, compared to those further away, before and after recreational pot became legal in Colorado in 2014. “While we hypothesize that some contributing factors may have included an increase in housing demand as a result of an increase in marijuana-related employment, lower crime rates, and additional amenities located in close proximity to retail conversions, finding the specific channels that explain our results is an open puzzle that we leave for future research,” the authors wrote. Beyond housing values, it is also valuable to note that marijuana retail locations could benefit neighbourhoods by driving foot traffic to merchants. “If it goes into a retail area and that spurs traffic for stores in that block or two, and they increase in value, there could be spillover to the residential neighbourhood,” says Queen’s University real estate professor John Andrew. “If you get excellent shopping and stores thriving in a particular area, people want to live near there.” Obviously it’s too early for Canadian municipalities to predict what the overall effects will be, but nevertheless, municipalities will have to learn how to adjust to the emergence of recreational cannabis retailers on the Canadian landscape.
Peter Sobchak Editor We welcome your feedback. Send your questions and comments to firstname.lastname@example.org building.ca
BLD FebMar 18.indd 5
2018-02-02 3:16 PM
MARKE T Spotlight: P3s
Canadian PPP market a case of peaks and valleys
Inframation released its Canada public-private partnerships (P3) state of the market report and revealed the value of deals to reach financial close in 2017 to date is $2.09 billion (all figures CAD), the lowest since the $1.42 billion recorded in 2006. The nine deals to reach financial close in 2017 have been in the social (four), environment (three) and transport (two) sectors. Of the nine, seven were in Ontario and two in British Columbia. The small capex size of the nine deals has meant that loans are set to be at their lowest level since 2012 and capital markets since 2006. The small capex for build-finance or design-build-finance deals as well as their increasing prevalence in the market suggests that equity deployment for 2017 is likely to come in at a sub-$50 million value for the first time since 2006. However, major procurements such as the Finch LRT, Hurontario LRT, Hamilton LRT, Ottawa Stage 2 LRT, the Gordie Howe Bridge, Toronto Courthouse and Union Station Enhancement could see the 2018 capex figures top the $10 billion mark once again. Throughout the latter half of 2017, provinces began making announcements regarding infrastructure spending, and the news sounds promising. For example Québec reaffirmed its commitment to infrastructure investments, especially after significant improvement in the province’s economic performance. Capital investments will remain steady at $91.1 billion over the 2018-2028 Québec Infrastructure Plan, with $9.6 billion planned in 2017-2018. FEBRUARY MARCH 2018
BLD FebMar 18.indd 6
Priority will be given to public safety and the replacement of outdated infrastructure and economic development, with projected capital investments of $13.7 billion in 2018-2019 under the Québec Infrastructure Plan. Manitoba’s Speech from the Throne in November included references to strategic infrastructure investments, P3s and a new social impact bond program. The speech referenced the government’s ongoing commitment to “making strategic infrastructure investments on the basis of real value for money,” as well as maximizing the use of federal funding under the Investing in Canada Fund and the Building Canada Fund. The government will also develop a long-term capital plan to get more value from renewing and building strategic infrastructure. In May, Premier Brian Pallister announced that the Manitoba government would study options to use P3s to deliver $100 million in school projects, and the Speech from the Throne reaffirmed the intention, saying the government will refine the framework for P3s to “deliver public infrastructure, including new schools, on time and on budget.” Winnipeg has procured several transportation projects using the P3 model and St. Paul’s College is currently evaluating proposals for a student housing P3 project. Ontario’s 2017 Fall Economic Outlook and Fiscal Review projects improved economic growth in the next three years and highlighted several key infrastructure investment areas, most of them in public transit, transportation and other priority infrastructure projects, such as the GO Regional Express Rail and Hurontario Light Rail Transit. b
2018-02-02 3:16 PM
Value of deals in procurement:
$26.06 billion Live deals:
$21.85 billion Live deals:
• RER Package 3
• Confederation Line
• Gordie Howe Bridge
• Hurontario LRT
• Finch West LRT
• Hamilton LRT
TOTAL VALUE LOAN CAPITAL MARKET EQUITY
• Union Station Enhancement
Canada P3 historic activity
British Columbia Pipeline value:
$ 3.33 billion
NOTABLE DEALS • Roberts Bank Terminal 2
($2.51 billion) ($0.41 billion)
• Abbotsford Courthouse
• Royal Inland Hospital
Source: Inframation, an Acuris Company
0.21 billion Live deals:
NOTABLE DEALS • All Season Road
BLD FebMar 18.indd 7
2018-02-02 3:16 PM
LEGAL Canada, the New Home of Cryptocurrency Mining? Demand from China is rising, but not just for luxury homes in Vancouver and Toronto -- Bitcoin mining farms have become the latest demand surge for industrial real estate in Canada. By Jeffrey W. Lem and Megan J. Lem
Whether it is Bitcoin, Ethereum, Ripple, Litecoin or one of the almost thousand other cryptocurrencies on the market today, virtual currencies are certainly now all the rage, both in the technological world and in financial circles. Building is not going to wade into the sea of literature already out on cryptocurrencies. What we will discuss, however, is the peculiar relationship between cryptocurrency and real estate, particularly older, aging industrial infrastructure. Like many things we perceive as “virtual,” even cryptocurrencies have a bricks-andmortar underpinning. To understand the leap from bitcoin to bricks-and-mortar, one first has to understand basically how cryptocurrency transactions are validated online. Jeffrey W. Lem is Most of the literature will describe the process in far Editor-in-Chief of the more sophisticated technical terms, but for Building purReal Property Reports poses, a broadband connection brings a cryptocurrency and the Director of Titles transaction to a computer. The computer then tries to solve for the Province of a mathematical puzzle associated with that cryptocurrency Ontario. The opinions transaction. If the computer successfully solves the puzzle, expressed in this article A store on West the solution back through the broadband conit transmits are personal to the Street in Goderich, nection, and the transaction is validated and confirmed as author and not Ont.’s historic downtown before the importantly for our purposes, the computer authentic. Most attributable or referable tornado hit (above), that solved the puzzle gets a commission, expressed as a to the government of the damage (right), miniscule percentage of the value of the cryptocurrency the Province of Ontario. and in August 2013 (below) after the town’s transaction that it just validated. This process is called rebuilding efforts. “cryptocurrency mining” and the computers that solve the puzzles are called “mining rigs.” Mining rigs can be anywhere and almost any type of computer. One of the touted benefits of cryptocurrencies is that it does not need a centralized government or bank computer to Megan J. Lem is verify each transaction. Indeed, at least in the early days of a corporate lawyer Bitcoin, much of the cryptocurrency mining was done by inin the Toronto office dividual tech geeks in their basements and the mining rigs of Osler, Hoskin they used were Pentium laptop computers from Best Buy. & Harcourt LLP. This Alas, that was then, and this is four years later (a veritaarticle reflects the ble lifetime in technology years). Today’s cryptocurrency opinions of the mining rigs are specialized computers (smaller than a bread author alone. FEBRUARY MARCH 2018
BLD FebMar 18.indd 8
box, with no monitors and no keyboards) with names like “Bitmain Antminer S9,” “Whatsminer M3,” and “Ebit 10.” Furthermore, while there are still some “ma and pa” cryptocurrency miners out there, the days of the small cryptocurrency miner seem gone, with modern cryptocurrency mining done in giant “cryptocurrency mining farms” — data centre-like warehouses with thousands upon thousands of these mining rigs lined-up in racks from floor to ceiling. Like almost all other industries in the world, cryptocurrency mining has gone big in order to realize economies of scale. Now for the bricks-and-mortar nexus and why these cryptocurrency mining farms translate into demand for Canadian real estate. Thousands of mining rigs lined-up in racks from floor to ceiling require a lot of electricity — both to power the mining rigs and to cool the tremendous amount of heat that each mining rig generates. Furthermore, cryptocurrency mining farms need reliable broadband with large bandwidth capacity. Finally, as an adjunct to the cooling issue, most of these mining farms are better situated in colder climates where cooling is naturally that much more affordable. Currently, almost all large-scale cryptocurrency mining farms are in China. There are probably historical reasons for this: cheap, state-subsidized electricity, cold climates in the north and western parts of the country, and the relatively cheap supply of leading-edge mining rigs (almost the entire world’s supply of specialized cryptocurrency mining rigs are made in China by a handful of specialty manufacturers, and the number of these mining rigs that are distributed outside of China is miniscule compared to those bought-up by the Chinese domestic market). It has been widely reported in the mainstream press, however, that the Chinese government is clamping down on the expansion of domestic cryptocurrency mining farms. This has set
2018-02-02 3:16 PM
“Virtual currencies, perhaps most notably Bitcoin, have captured the imagination of some, struck fear among others, and confused the heck out of the rest of us.” — Thomas Carper, U.S. Senator (D-DE)
the stage for almost all of the expansion of cryptocurrency mining farms to take place outside of China, and Canada fits the bill surprisingly well: relatively available broadband; relatively affordable hydro; and relatively cold climate (especially this winter!). Most of the cryptocurrency mining farm clients that have already come over from China have gone to hosting and co-location facilities in Québec, both because of that province’s relatively economical electricity prices and because of Québec’s public openness to doing business with these Chinese entrepreneurs. To a lesser degree, Chinese mining farms have also been seen conducting diligence in Manitoba (cheap electricity) and British Columbia (just because
the Chinese always seem to investigate British Columbia). The problem for the Canadian landlords and power suppliers (both government and private) will be to separate the wheat from the chaff, and to determine which of the pending flood of Chinese cryptocurrency miners are going to have the wherewithal and capital to actually be viable in this country, in a business which itself is wildly volatile. That said, the facilities that make ideal cryptocurrency mining farms are surprisingly low-tech and capital un-intensive. Some have described them as nothing more than old warehouses with lots of computer racking, lots of fans, and a lunchroom! Therein lies the greatest opportunity for Canada — older industrial and commercial facilities that are in need of retrofitting and renovation, can be easily retasked to capitalize on this new industry. The very buildings that Canada currently has little current use for (including derelict or underutilized power plants and industrial facilities) can be re-tasked to cryptocurrency mining with almost no capital outlay whatsoever. Alas, opportunities in the tech industry come and go in a blink of an eye, and only time will tell which parts of the country can seize this opportunity before it too goes the way of the VCR, CD ROM, and snail mail. b
Introducing IKO 2-IN-1 Insulated WRB System.
Tyco is now Johnson Controls. T he wo rl d l e a d e r in f ire p ro te c tio n , security, HVAC, building controls and energy storage. Count on us for innovative solutions that lead to safer building environments and better outcomes for customers. To learn more about the merger and our complete suite of offerings, visit:
When IKO Enerfoil® or Ener-Air™ polyisocyanurate insulation sheathing boards are used with IKO AquaBarrier™ Tapes, this innovative 2-in-1 system eliminates the need for a separate membrane system to control air and vapour. To learn more today, contact an IKO Representative, or call1-855-IKO-ROOF (1-855456-7663) or visit WWW.IKO.COM/COMM.
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?
Project: Where does purple... 4222_Walltite_TeaserAd_FINAL-BM.indd 1 Date: Mar 12 2015 Designer: JM
BLD FebMar 18.indd 9
Publication: Building Magazine Size: 3.5” x 2.24” Bleed: Colour: CMYK
STEEL BUILDINGS SINCE 1980
Agency: ON Communication Inc Agency Contact: Raellen Seaman2015-03-12 Telephone: 519-434-1365 xt 228 Email: email@example.com
2018-02-02 3:16 PM
MM3Axxx_IKO_Comm_Ad_Construction Canada_1017.indd 1 BLD FebMar 18.indd 10
2017-12-07 1:08 PM 2018-02-02 3:16 PM
ART IN CONDOLAND
By Chris Hampton
Development mania across Canada is marked by eye-catching public art. But what makes such works successful? No one, it seems, can quite agree
07 1:08 PM BLD FebMar 18.indd 11
BGL, La vélocité des lieux, 2015. Galvanized iron, aluminum, stainless steel and Plexiglas, 17.3 x 13.7 x 2.4 m (wheel); 12.8 x 12.8 m (base). Courtesy: Parisian Laundry. Collection: City of Montreal.
Right now, it’s a pit. At the centre of Toronto’s so-called Condoland—the band of residential towers that over the past 15 years have transformed a decommissioned rail yard at the city centre into a master-planned community for 18,000 residents— there’s an excavation the size of a city block. The site is scabbed over with goldenrod, something that looks like thistle and various reedy grasses. Trees there have grown woody, with some reaching almost a storey high in the time the site has sat waiting. Bordered to the west by an artificial-turf playing field and to the east by the patio of a Fox and Fiddle pub, it is an unlikely meadow among CityPlace’s glass-skinned peaks. The City calls it Block 31. In time for the 2019 school year, if construction goes as scheduled, Block 31 will become the site of two 550-student K–8 schools (one Catholic, one public), a 52-spot daycare and a community centre with a gymnasium, dance stubuilding.ca
2018-02-02 3:16 PM
dios and a whole suite of programming functions. There’ll be rooftop gardens, basketball courts and a year-round marketplace. These facilities represent crucial elements of social infrastructure, two decades in the works, that will, the ward’s councillor says, make the neighbourhood more livable for families. Meanwhile, the zoning by-law amendment notices posted on the fence, defending the perimeter of what’s still now a weedy hole, ask you to imagine what someday will be. As is municipal practice with major city-led building projects, the community centre-school-daycare complex will include a piece of public art. Local sculptor Georgia Dickie, who won the open contest, has planned a grouping of sculptures formed in CorTen steel (think Richard Serra), a counterpoint to the “lush” flora she found had reclaimed the site. Emerging from the playground and descending to the south, the sculptures will draw the eye toward the waterfront. She wants to give neighbours a gathering place, a hub. The work suggests notions of community and communication with forms inspired by ears, antennas, residential satellite dishes and acoustic mirrors. Dickie wants the sculptures to appear as relics, she says, as if the prehistoric Lake Iroquois revealed them as it receded. She also wants them to represent Toronto on the edge of the future. Because, in some ways, that’s what this place—one of the largest residential developments in the city’s history—is.
on public land, expressly for public enjoyment, became entrenched in the formalized practices of city-building. “But what does it do?” you can easily imagine someone consternating, maybe from the shadow of a street-cornersized steel abstraction. “And why should we spend public money on it?” Across this reporting, I’ve encountered a long litany of arguments about how public art enhances the urban experience: it creates gathering points and place markers; it provides civic identity; it helps circulation; it’s a tourist attraction; it serves a function unfulfilled elsewhere in nearby urban design (i.e., a place to sit or play) or— and this was the most common response—it generally adds interest to a neighbourhood, park, plaza or building. At a town hall meeting, when the city of Calgary was recently reviewing its program, one resident poetically called public art: “moments of small delight in my daily commute.” It is described often as a benefit to the quality of life. Now, as urban populations continue to increase across Canada, many even mid-sized cities find themselves in some stage of transformation, growing taller and denser. The boom in private development has city planners and politicians exploring ways to leverage developers wanting to add density with the community benefits necessary to serve fast-growing and changing neighbourhoods; that means affordable housing, green spaces and, in some cases, public art. Private developers across the country, it turns out, love public art and have become benefactors of a great many works. Ask the average citizen, though, how the monument they eat lunch by every day came to be and they’re likely to stare back as dimly as the statue. The making of this particular
From early on, public art programs have reflected, benefited from and participated in the development of their cities. In 1959, Philadelphia enacted the first Percent for Public Art ordinance, dedicating a portion of construction costs from municipal projects to fine art. Detailed in the book Going Public—a popular field guide produced in 1988, or “Public Art 101,” as it was introduced to me—similar programs proliferated through the activist eras of the 1960s and ’70s. Governments on every level sought to build out the public realm alongside an assortment of urban-revitalization projects begun across North America to bring populations, then fleeing to the suburbs, back into city centres. Early in that history, the National Capital Commission started its work on the “natural and cultural character” of Ottawa. And shortly after, in 1961, Québec enacted an ambitious, province-wide Percent for Public Art program. During this period of utopian growth, the notion of artworks installed, often FEBRUARY MARCH 2018
BLD FebMar 18.indd 12
2018-02-02 3:16 PM
public benefit is, for most, esoterica: an unsexy and bureaucratic procedure, doubly mired in “planningspeak” and the tedium of municipal politics. Launching myself down that rabbit hole was at times a frustrating assignment, chockfull of unspecificity, exceptions to the rule, extra-large and extra-dry PDFs, unresponsive subjects, subjects “too busy” to respond and the phrase: “that’s not my department, you’ll have to ask so-and-so.” All of this was weathered in search of some fundamental understanding of how Canada’s largest cities commission public art, fund public art and envision the role of public art in the betterment of urban living. In 1986, Toronto became the first Canadian municipality to enact policies to encourage public art in major developments, both public and private. In chapter three of the City’s official plan, appearing between “Built Form – Tall Buildings” and “Heritage Conservation,” there’s a sub-section dedicated to public art. Here, you’ll find clues about how Toronto promotes and funds its program. Item 3.1.4d, for example, outlines how the creation of public art ought to be included in the City’s own construction projects. According to the official plan, the City will dedicate “one per cent of the capital budget of all major municipal buildings and structures to public art.” The word “major” here separates Toronto’s capital contribution policy from cities like Calgary, where every municipal project over a certain size pays a percentage toward public art. In Toronto, it’s about identifying high-impact opportunities, says Jane Perdue, Toronto’s public art coordinator for city planning. “How accessible is the site? What’s the public use?” A marquee sports complex built in Scarborough for the 2015 Pan Am and Parapan Am Games, for instance, received significant funding for a piece by Québec art trio BGL; water-main replacements along downtown’s River Street won’t. Bringing up the rear in the plan’s dictate on public art, the final bullet point states, may be a bit limply: “[encourage] the incluInges Idee, Travelling Light, 2013. Steel, paint and light-device, 20 x 19.5 x 7.5 m. Courtesy: City of Calgary.
sion of public art in all significant private sector developments across the City.” Belying the loose, non-mandatory and minor-sounding language of this particular directive, in the past decade or so, such private-sector contributions have become the primary source of public art in Toronto, adding to the city-wide collection as plentifully as they’ve added to the skyline. Section 37 of the Ontario Planning Act—the main source of that private contribution—is a buzzy, often misunderstood tool. The mechanism enables every city in the province to negotiate boosted infrastructures and the provision of community benefits, such as affordable housing, improved streetscapes and public art, from developers that want to build in excess of the site’s zoned height and density. While some smaller Ontarian cities act tentatively, worried that Section 37 negotiations might discourage developers, Perdue says it’s regular in the competitive Toronto market. As per Toronto’s particular bylaws, Section 37 comes into play when a developer requires a zoning-bylaw amendment for a development of more than 10,000 square metres in gross floor area and has applied to increase the permitted density by at least 1,500 square metres. For some sense of scale, First Canadian Place, the 72-storey monster at Bay and King Streets in Toronto that, for now, carries the title of Canada’s Tallest Skyscraper, is 250,849 square metres. The St. Lawrence Market South building—to lend some concrete sense to that bottom end—is 10,355 square metres. “Section 37 benefits are negotiated on a case-by-case basis with developers,” says Gregg Lintern, the director of community planning for Toronto and East York. Unlike some cities where the dollars-and-cents side of density bonusing is formalized with a per-square-metre rate, in Toronto, he tells me, “there are no set negotiations or percentages.” It’s difficult for the City to speak in specifics, Lintern says, tendering only: “the City seeks to capture a portion of the appraised value of the additional density requested by the development applicant.” That’s the same line reprinted elsewhere in City literature. A 2014 report reviewing Section 37 in Toronto lets in a little more light, explaining that “the City’s been able to secure between 10 and 20 per cent of the increase in land value for most developments.” How that money gets used is determined by a process that identifies community needs and priorities in consultation with the city councillor, local residents and various other municipal departments. The package of negotiated benefits might include things like park improvements and affordable housing. Toronto councillor Joe Cressy says that 20 per cent of every Section 37 deal in his ward—which includes Block 31—goes toward affordable housing. The benefit package might also include public art, as was the case with the building wrapped in a Vito Acconci fence near Fort York. Perdue estimates that in the last five years, Section 37 has triggered roughly $45 million in public art in Toronto.
BLD FebMar 18.indd 13
2018-02-02 3:16 PM
If art is chosen as a fitting amenity, the developer may commission a public artwork on-site for the agreed-upon value, provide cash-in-lieu for an off-site project, or some combination of the two. With the off-site option, the City has the ability to pool money for a larger project on City land anywhere within the same ward. Trump Tower in Toronto, for example, includes a Michael Snow lightwork stretching vertically up its exterior and a more than 500,000-piece mosaic by Stephen Andrews in its porte-cochère; the development also helped pay for an aquatic centre in Regent Park, one of Toronto’s Neighbourhood Improvement Areas “requiring special attention.” If the developer decides instead to commission work onsite, the Toronto Public Art Commission, a volunteer panel from the art and urban design communities, reviews the developer’s public art plan and ensures that the selection process, be it open competition or by invitation, is suitable. Dickie took her duty to the burgeoning CityPlace community to heart. When she was designing her proposal—one of more than 100 submissions the City received for the project— she visited the site almost daily. She’d hang out in the grocery store to get a sense of who lived there. She found a lot of people travelling through by themselves: earphones in, talking on the phone, grabbing lunch to go. She wanted to give them a destination. She wanted to anchor a sense of place. Standing at the perimeter fence, approximating for me where her sculpture will one day sit, us both transposing the scene imaginarily over a giant pit carpeted by a good winter snowfall, Dickie says she’s not exactly sure what happens next, procedurally speaking. We do know, though, that by summer 2019 (again, construction permitting), the character of this neighbourhood will be thoroughly transformed, thanks in part to her work here.
Comparing municipal programs across Canada, I started to see the field as a sort of grand urban experiment, with sometimes-radical permutations on the same basic structure regarding the roles of the public and private sectors in the making of public art. Each city formed a unique set of answers to the questions: ought the City set aside a portion from its own construction projects for public art? From which projects? How much? What should be required of private developers? One culture manager admiringly called Toronto’s Perdue “encyclopedic” when it comes to public art policy in Canada, and even Perdue, over one of our many conversations, told FEBRUARY MARCH 2018
BLD FebMar 18.indd 14
me something to the effect of: I’m really not sure which model works best. In Montréal, thanks to Québec’s long-standing “Politique d’intégration des arts à l’architecture,” every building project that receives provincial money and will be open to the public dedicates a percentage of the total construction cost to public art. Projects costing between $150,000 and $400,000, for instance, must set aside 1.75 per cent. The scale slides up from there, so that, at the high end, projects costing more than $5 million must contribute $67,500 for the first $5 million and 0.5 per cent on any additional costs. Alternately, as Michèle Picard, head of Montréal’s public art bureau, explains, if the project generates only a small amount of money, there’s a committee that acquires smaller works—a painting or sculpture, for example—for the space. The City of Montréal itself doesn’t have an official per cent for public art policy on municipal projects; Picard describes it as “a habit.” “Not every project needs to have public art,” she says. “We prefer to work differently.” Over the past 10 years, her team has cooperated with other municipal departments to involve themselves at the start of large building projects to identify suitable opportunities for public art. A major road reconstruction project at Pie-IX and Henri Bourassa Boulevards, a bridge entering the city, was treated to something major: a $1.1 million, full-scale Ferris wheel sculpture titled La vélocité des lieux by BGL (some practices have become darlings of the arena). Since permitting in Montréal is scattered across the 19 individual boroughs, there is currently no overarching policy about contributions from private developers in exchange for bonus height or density. Montréal may be experiencing its own condo boom, but to-date, borough councillors haven’t negotiated for public art in what agreements have been made, Picard says. “Mainly, they go for low-income housing.” Since 1991, Vancouver has had a public art program set up to include both civic- and private-sector contributions. The discussion may have been driven in large part by the development around False Creek just after Expo 86, says Karen Henry, interim manager of the City’s public art program. There, as of September 2016, almost every private-sector rezoning of more than 100,000 square feet must contribute $1.98 per buildable square foot to public art (other community benefits are negotiated in addition to and separate from the art). Developers can either commission the work on-site or, as of just recently, pay 80 per cent cash-in-lieu, which the City may pool toward a “signature” artwork to be installed elsewhere. Instead of a civic Percent for Art policy, public art is allocated a lump sum within the City of Vancouver’s four-year (formerly three-year) capital plan. For the 2015–18 period, $4 million has been earmarked for new public art as well as maintenance and restoration for existing works. The years before the 2010 Vancouver Winter
2018-02-02 3:16 PM
Olympics saw a large influx of new works in preparation for the events, including the instantly iconic 17.5-metre LED cross installed at Clark Drive and East 6th Avenue by Ken Lum, titled Monument for East Vancouver. But between 2012 and 2014, the planning block directly following the Games, public art was cut back to $250,000, what Henry describes as an “extremely dry” period for a lot of City departments. Private-sector contributions fluctuate with development activity, she explains, and after the Olympics, which brought work to a standstill, it took builders a few years to get up and running again. There was a lag, she says, which they patched with a series of temporary works like the award-winning Year of Reconciliation public art project, which brought the work of 10 Indigenous and non-Indigenous artists reflecting on the theme “reconciliation” to video screens, a library and transit shelters throughout the city. Calgary, as already mentioned, has a robust Percent for Public Art policy. As of 2004, when it was adopted, every city build costing $1 million or more that’s considered an upgrade, a growth or a service—be it a transit station, a new park, even a sewer—must budget one per cent of the project for public art, according to manager of arts and culture Sarah Iley (this recently dropped to 0.5 per cent after the first $50 million of eligible capital project costs, up to a maximum of $4 million). Brian Tolle’s Outflow (2015), an inverted concrete mountain installed in Parkdale Plaza, daylights the processes of water management. It was paid for by money pooled from infrastructure projects by the City’s Utilities and Environmental Protection department. Since the 1980s, Calgary has had a formalized policy for developers wanting bonus density. They could either purchase it outright (in the Beltline district, for instance, at about $270 per square metre according to the latest Area Redevelopment Plan), or they could choose from what Ben Barrington, Centre City implementation program manager, calls a “menu” of community benefits, one option of which is public art. When
Daniel Young and Christian Giroux, Nyctophilia, 2014. Concrete hydro poles, aluminum cobra head lights, LEDs, computer controller, concrete sidewalk, strawberry and sumac plants, 19.8 x 4.3 x 10.7 m. Collection: City of Toronto.
planning the Bow, the second-tallest tower in Calgary’s skyline, developers wanted to significantly increase the zoned floor area, adding 17,526 square metres. In exchange, two works by Catalan artist Jaume Plensa were commissioned on-site at a cost of just over $3.5 million, including, most prominently, Wonderland (2008–12), a 12-metre-tall wireframe sculpture of a girl’s head. The work has become an Instagram hotspot and a destination for wedding photos, which imparts, I’d think, some measure of community uptake. Not every project has been so favourably received. Calgary’s public art program, and its Percent for Public Art policy in particular, drew national attention when the artwork Travelling Light (2013) by German collective Inges Idee was unveiled and widely panned. Even Naheed Nenshi, popularly known as the civic-boosting “Best Mayor in the World,” called the piece— colloquially titled “The Giant Blue Ring”—“awful.” But he also made mention that, “80 per cent of the work and the budget was spent in Calgary with Calgary businesses.” There is an economic argument for funding public art. Right now, when Alberta is experiencing a recession, spending on infrastructure is seen as a kick-start. By the City’s policy, that means those initiatives are also spinning off investments in public art. Inevitably, someone says, “Wait a minute, that’s taxpayer money. Is that the right thing to do now?” Iley is familiar with the concern. If taxpayer dollars are being used to generate a better economy, she says, shouldn’t some small part of that be used to generate a better economy for artists and creative labourers, too? And what if we can create a better, more livable environment at the same time? That’s money that also trickles down to all sorts of local fabricators, installers and technicians. The Calgary fabrication company that worked on Travelling Light, Iley says, has since got contracts in Singapore. building.ca
BLD FebMar 18.indd 15
2018-02-02 3:16 PM
When asked what a successful piece of public art in Calgary looks like and what it does, Iley brings up Pechet Studio’s roger that (2015). At Tuscany Station, the end of the LRT line in the city’s northwest, where the communities of Tuscany and Rocky Ridge are divided by a multi-lane roadway, the artists built a series of solar-powered light towers. Viewed from precise points on either side of the road, the clustered lights form a perfect circle, as if the two communities are connecting. “It’s magical,” Iley says. “It’s become a meet-me-there destination, and it reflects exactly what those two neighbourhoods said they wanted: to get to know each other better.” Ultimately the success of public art is measured by how it serves its community. Sometimes, that value is realized immediately. More often, it takes time.
Mount Dennis is a neighbourhood in west Toronto hem med in by the Humber River and the Kitchener rail corridor. It was once a significant manufacturing zone, home to brickworks, foundries and factories. In the years since major industry there moved off-shore or closed, it’s been un derserved and struggling to redevelop. Today, the riding is among the poorest in the province. It’s been designated a “priority neighbourhood.” When Toronto Life first ranked the city’s 140 neighbourhoods in 2013, Mount Dennis finished last. Despite the gloomy indicators, on street-level, there are signs of new growth. Around Weston Road, the neighbourhood’s main corridor, you’ll find fresh-looking storefronts— an indie coffee spot, a sandwich shop, a high-end appliance distributor. The library has undergone a dramatic renovation, and nearby, a brand new recreation centre just opened. At the top of the hill, installed on a traffic-calming peninsula where the Mount Dennis retail strip begins, there’s another recent development: public art. Nyctophilia (2014), by artists Daniel Young and Christian Giroux, is a grouping of 10 utility poles sprouting off 36 streetlights, most of them multi-coloured and programmable. It uses the language of urban infrastructure to create a surrealist forest. “It’s like some Situationist proposal for a city,” Young says. Locals call it “the pole farm.” Public art has become a significant part of Young and Giroux’s practice. When the collectorship of sculpture in Canada is thin, projects like these are vital to their sustenance. FEBRUARY MARCH 2018
BLD FebMar 18.indd 16
The pair found Nyctophilia especially rewarding because they got to work in a neighbourhood where public art might not usually exist. It’s a challenge to uneven urban development, Young says. It suggests there ought to be cultural investment in all parts of the city, not just downtown. When work on Nyctophilia got underway, the initiative represented the first major investment in Mount Dennis in some time, public art officer Clara Hargittay says. Its $250,000 price tag was covered mainly by Section 37 funds sitting around from a series of developments elsewhere in the ward. The local councillor thought the neighbourhood could use an intervention like public art to lift its spirits. Over two consultation meetings at the local Legion hall, the community discussed what public art could contribute to the neighbourhood. There were a limited number of things the money could be used for, Mount Dennis Community Association president Mike Mattos remembers. The area has lots of parklands. It wasn’t enough money for a splash pad. “We all agreed that having something was better than nothing,” says Mattos. Since Nyctophilia went in the ground, reactions have been mixed. A Toronto Star article called the work “wasteful and hideous.” Another source said they would’ve preferred that the money was used on street improvements. Mattos himself says he’s disappointed, not in Young and Giroux’s design, more in the implementation. Sewer and road surfacing work nearby meant the area around Nyctophilia has been ripped up and blocked off repeatedly. A construction bin was parked almost permanently beside the artwork. It hasn’t yet become the meeting place they hoped. Even the community association is split. MDCA secretary Simon Chamberlain quite likes it. He shows it off to visitors. Whenever he drives by, he watches for its polychromatic display. Perhaps, like Henry Moore’s The Archer, parked out front of City Hall, he says, it will become better appreciated over time. In December, the BIA, which uses Nyctophilia front-andcentre in its branding, held a solstice party under the artwork’s soft glow, programmed a wintry blue. There was a pop-up store, entertainers, a face-painting station, hot chocolate and a Santa Claus to visit. When I stopped by, 60 or 70 people had shown up, mostly Chris Hampton is a young families. Lots of kids. A thrilling freelance writer based in turnout, I’m sure, for organizers in a Toronto. His work has community short on community spaces. appeared in the Walrus, Mattos called it one of the first times the New York Times, the Nyctophilia had been allowed to be the Toronto Star and the meeting place Mount Dennis wanted. I Globe and Mail, among overheard one woman say, between sips other publications. This of hot chocolate, “There should be more article originally appeared things like this.” She was talking about in the Spring 2017 issue the party, of course. But maybe she was of Canadian Art. www. talking about the art, too. b canadianart.ca
2018-02-02 3:16 PM
Tyco is now Johnson Controls. The combined strengths of two great companies are now under one great name. Johnson Controls. The world leader in fire protection, security, HVAC, building controls and energy storage. Count on us for innovative solutions that lead to safer building environments and better outcomes for customers. Exactly what you’d expect from a leader.
To learn more about the merger and our complete suite of offerings, visit Tycoifs.ca.
RBQ 3050-7412-83. Tyco Integrated Fire & Security and the product names are marks and/or registered marks of Johnson Controls. Unauthorized use is strictly prohibited worldwide. All other marks are property of their respective owners.
BLD FebMar 18.indd 17
077123 JCI-SimplexGrinnell Buildings_Canada • 8”x10.75” • 1/25/18
2018-02-02 3:16 PM
F By Stefan Novakovic
A PATH TO THE BIAs, the Data Revolution and City Building
loating 61 feet tall, 79 feet wide, and 89 feet long, the world’s largest rubber duck brought its unmistakable presence to Toronto’s downtown lakefront last summer. Weighing nearly 14 tonnes, the endearingly graceless yellow behemoth was a showpiece of the Redpath Waterfont Festival. As novelty Instagram bait, the duck’s appeal was obvious — few objects demand hashtags and selfies quite as loudly as a six-storey bathtub ornament. Beyond that, however, the zeal for the installation was harder to understand, particularly given the fact that a Canada150 grant from Queen’s Park of $120,000 was used to fund it. What’s more, the annual event was co-presented by a variety of businesses and local organizations, prominent among them the Waterfront Business Improvement Area. The last fact begs the question: what does a rubber duck have to do with business? The answer is relatively simple and almost 50 years in the making. THE BIRTH OF BIAS
In 1966, the opening of the first phase of Toronto’s Bloor-Danforth subway line sparked a transformation of the prominent street, and the city around it. A major west end arterial, Bloor Street became the busiest part of the city’s primary eastwest transit corridor, replacing the slower and more limited streetcar service that preceded it. For Toronto, the new subway line represented a crucial step in the city’s evolution to becoming a global financial capital in the 21st century, while catalyzing over a half-century of rapid growth and ambitious — albeit often confused and interrupted — city-building. Just two years later, the first extension of the line was completed, with six new stations stretching subway service past High Park and into Etobicoke. In transit terms, it was and remains an unmitigated success. In the aftermath of the subway’s completion, however, stretches of Bloor Street did not immediately experience the infusion of vibrancy that comes with improved
FEBRUARY MARCH 2018
BLD FebMar 18.indd 18
2018-02-02 3:16 PM
Photography by Briony Douglas (right)
ABOVE LEFT: A contransit. Instead, the businesses lining the Bloor West Village troversial centrepiece neighbourhood suffered. Replacing the closely spaced, pedesof 2017’s Redpath trian-friendly stops, and the views of storefronts afforded by Waterfront Festival, the streetcar, the subway meant a quicker commute, but less the world’s largest rubber duck was of a connection to the street. To make matters worse, intenbrought to Toronto sifying suburbanization prompted construction of big box via a $120,000 grant malls, further threatening the vitality of fine-grained urban from the Ontario businesses. In 1970, Bloor Street’s businesses responded. government. ABOVE RIGHT: Black Over coffees and sticky buns in the back room of a local Bamboo by Benbakery, a group of local business owners formed the Bloor net Marburger and Ji West Village Business Improvement Area (BIA) — the first orZhang of 2408 Studio ganization of its kind in the world. comes to Toronto’s winter waterfront as Collecting additional taxes from local businesses, the part of the Ice BreakBIA used the funds to promote the Bloor West neighbourhood ers 2018 exhibit. as a shopping destination. The nascent organization focused on rudimentary streetscape improvements and beautification projects, and it worked. In those early years, planters on the sidewalks and lights on the trees enlivened the stretch of Bloor between Jane Street and Runnymede Road in a modest but meaningful way. Knitting together a stronger distinct neighbourhood identity, the BIA’s efforts helped create a renewed destination, and renewed revenue. Today, there are over 80 BIAs in the City of Toronto alone, and hundreds across Canada. South of the border, the first Business Improvement District (BID) to follow Toronto’s example came to New Orleans in 1974, with a 2011 report by the International Downtown Association finding over 1,000 BIDs across the United States. Today, the business improvement model ranks as one of Canada’s most successful exports, with equivalents existing in England, Scotland, Wales, and Germany. Since 1970, the basic structure of BIAs has remained unchanged: a group of associated businesses voluntarily impose a local tax, and the proceeds collected are put toward collectively beneficial initiatives. In 2018, the challenges are different and the ambitions greater. Enter the era of rubber ducks, and the era of businesses as city-builders.
BACKED BY DATA
For the Waterfront BIA (WBIA), the rubber duck is just one entry in a full year’s calendar of activity, which includes everything from walking tours to cultural festivals, sporting events, food fairs, and markets. As Carol Jolly, Executive Director of the WBIA explains, “All of that helps to build foot traffic,” and to “create a destination, not only for the city, but for the world.” To business owners, all of that means paying up. “At the end of the day, we’re spending other people’s money, and we have to have data to back it up,” says Jolly. The annual Ice Breakers outdoor art installations are a prime example, bringing activity and revenue to the winter waterfront each year. “We make sure to keep careful track of the impacts,” she stresses, “and the data shows that the visitors are shopping and dining,” with an average spend of well over $20 per person. For 2018, “over 30 businesses are actively promoting Ice Breakers, with bars and restaurants even creating signature drinks to mark the occasion,” she explains. Still, if funding a series of art installations or a cultural festival don’t seem like an intuitive sell to small retailers, that’s because it probably isn’t. The data
BLD FebMar 18.indd 19
2018-02-02 3:16 PM
FEBRUARY MARCH 2018
BLD FebMar 18.indd 20
“We’ve even started talking to developers about the street-level layout of new construction projects,” Jolly notes, explaining that the business community is now taking a more active role in urban design. In 2017, the WBIA released its impressively thorough and far-sighted Strategic Framework & Tactical Plan. Developed by international real estate development and advisory firm Live Work Learn Play (LWLP), the Strategic Framework outlines the central goals of not only creating a city destination, but of transforming Toronto into a ‘Waterfront City.’ Detailed and data-driven, the report outlines the physical and psychological barriers to the waterfront as impediments to visitation, diagnosing “a lack of reasons to linger on the street.” The solutions, according to LWLP, include fostering districts with “a distinct sense of place,” while improving pedestrian connections and creating more year-round programming. LWLP partner and principal Rob Spanier frames the WBIA’s Plan within the context of changing stakes. “When you look at the central waterfront, it’s not just a matter of responding to online retail,” he says, “you’ve also got Sidewalk Labs developing what’s touted as the ‘neighbourhood of the future’ to the east.” Sidewalk Labs, a subsidiary of Google parent company Alphabet, recently chose Toronto as the first testing for the company’s foray into real estate. “And you’ve got to respond to that,” Spanier stresses. NAVIGATING VISION AND INTERESTS
Yet, for all the impressive urbanist credentials now being collected by large BIAs, there are equally potent criticisms. In a 2016 critique in The New Republic, Max Rivlin-Nadler wrote that American “Business Improvement Districts are a favored neoliberal practice that transforms mixed-income neighborhoods into the same chain stores one can find at any outlet mall across the country.” The creation of new BIDs is sometimes even vehemently protested. BIDs, Rivlin-Nadler argued, are typically agents of gentrification, and become part of an undemocratic “power play for public space.” Considering that some American BIDs even
Photography by Briony Douglas
ABOVE: As part is harder to argue with. For its part, the of Ice Breakers, rubber duck attracted some 75,000 Thena Tak’s Winter visitors to the waterfront during the FanFare and Tanya July 2017 long weekend, with analysis Goertzen’s Through the Eyes of the Bear by Enigma Research concluding that (l-r) are a means the installation brought some $7.6 milof attracting foot lion of “economic impact” to the city. traffic and revenue Suddenly, spending $120,000 of public to the lakefront money on inflatable waterfowl seems during the normally like a prudent investment. less-than-hospitable winter months. For Jolly, it’s a natural process of change. “BIAs are evolving, just like cities are evolving,” she says. Indeed, today’s demographic and technological landscape is very different from 1970. Across North America, urban environments hold more appeal for many young professionals than the suburbs, while the compact layouts of new high-rise suites makes the appeal of a ‘third place’ or ‘outdoor living room’ all the greater. Meanwhile, the rise of online shopping changes the equation for bricks and mortar retailers. If any product is only a click or two away, then the appeal of shopping has to be more than just that. In many cases, the appeal of going to the store is the experience of being there. As Jolly puts it, “We’re not just thinking about visitor traffic, we’re thinking about the living quality of surrounding neighbourhoods. People living downtown need an outdoor living space.” Nonetheless, the basic role of the BIA remains in tune with the street-level improvements pioneered in Bloor West Village. For Jolly, a “focus on the streetscape” is paramount, with quality of place always top of mind. While the terms ‘city-building’ and ‘placemaking’ were not common parlance in the ‘70s, a continuity of urbanist influence isn’t hard to see. In fact, the process of adapting to online retail through experiential appeals mirrors the challenges faced by 20th century urban retailers competing with new suburban malls. You can’t get the urban experience at the mall, and you certainly can’t get it on Amazon. Yet, if the principles remain consistent, the scope of influence is massively expanded.
2018-02-02 3:16 PM
Bathurst Quay Neighbourhood
Lower Simcoe St
Dan leckie Way
WBIA District Strategy
Ferry Terminal District
Enhanced gathering places
hire private security to patrol the streets, the argument is hardly a stretch. Is that the case in Toronto? The WBIA’s rhetoric suggests otherwise. “We understand that we’re not Bloor-Yorkville, and that the appeal of each neighbourhood is it’s uniqueness. We’ve got the water, and much of our success depends on our relationship with it,” says Jolly, arguing that “distinct character is what makes a neighbourhood appealing in the first place. We want to nurture that.” Joe Cressy, the WBIA’s local City Councillor, strikes a similar tone. “Our BIAs improve the quality and character of our neighbourhoods,” he says. “It’s in the city’s best interest to have vibrant and dynamic business district.”
“We’re not just thinking about visitor quality. We’re thinking about the living quality of surrounding neighbourhoods.” Kensington Market, one of the city’s newest BIAs (and also in Cressy’s Ward) reinforces his point. In what may be Toronto’s most eclectic and independently minded retail destination, a BIA was created to give a more empowered voice to some 240 local businesses; not to roll out the red carpet for Starbucks and Banana Republic. With a Board of Management composed of independent community entrepreneurs, the structure of the organization is designed to ensure that local interests remain at the forefront. There are two lessons to take from this. First, that business interests and pedestrian-friendly planning initiatives are often symbiotic, and that urbanists can find important allies in local businesses. The very fact that so many BIAs are willing to voluntarily tax themselves to pay for public
benefits makes that clear. The second lesson? Data. Businesses won’t come on board unless there are convincing reasons to expect returns. The point takes on particular urgency when we consider the conflicts between business owners and urban planners that continue to make headlines in Toronto. In 2016, the installations of bike lanes along Bloor Street, initially as a pilot project, raised more than a few eyebrows from local business owners, some of whom remained convinced that the removal of street parking would cripple revenue. For its part, the City of Toronto collected extensive data, smoothing out the pilot project’s early design to create a more welcoming destination where the influx of cyclists more than compensates for marginally slower vehicle traffic and reduced parking. In launching the project with Council colleague Mike Layton, Cressy invoked former New York Mayor Michael Bloomberg: “In God we trust. Everyone else bring data.” Eighteen months later, and a more heated debate rages on King Street where another new pilot project has restricted vehicle traffic in favour of a right-of-way for the streetcar. On North America’s busiest surface transit route, the project is an obvious win for riders, creating a speedier commute through the urban core while also opening up road space to pedestrians. From an urbanist lens, the project is a success, creating much more efficient and democratic use of space by removing private vehicles that dominated the road in favour of public transit. Among some business owners, however, the project is strongly opposed. In January, one King Street restaurant even installed an ice sculpture depicting a giant middle finger — emblazoned with the words “fuddle duddle” — in protest. As with the Bloor Street bike lanes, a local BIA is not a central player in the controversy. Nonetheless, the data-driven example of the WBIA carries important lessons. For King Street, the first round of data was released by the City of Toronto in December. The results, for riders, urbanists, local politicians, transit planners, city-builders, and most businesses, were promising. b building.ca
BLD FebMar 18.indd 21
2018-02-02 3:16 PM
Keep operating costs from going through the roof Our thermally broken roof hatch lowers building operating costs by minimizing heat transfer between interior and exterior metal surfaces, thereby resisting harmful condensation and providing superior energy efficiency under any conditions.
Roof Hatch Features: • • • • •
Patented thermally broken design R-20+ insulation Aluminum construction Engineered cover gasket system Lab tested & certified for thermal performance
BLD FebMar 18.indd 22
2018-02-02 3:16 PM
What’s Coming, What’s Here, and Do We Care?
CRE executives have
significant reservations about emerging disruptive technologies.
By Michael Crook
nhanced data and analytics, along with new applications to streamline processes, are having a substantial impact on many industries as they work to create better value through process efficiencies. The commercial real estate (CRE) industry has historically been slower to adopt new technologies, but there exists a rapidly growing awareness of the impact transformative technology can deliver. Technology venture capital investment in “PropTech” has been increasing like never before, and while a large majority of firms have benefitted from technology investments made over the past two years, a recent report from Altus Group found that CRE executives have clear reservations about the potential of new technologies to drive industry-wide change.
Emerging Disruptive Technologies Have Arrived
R/ VR )
Ve hic les
Dr ive rle ss
Bl oc kc ha in
Te ch no lo gy
Re ali ty Vi rtu al an d Au gm en te d
An aly tic s Da ta
Pr ed ict ive
In te llig en ce
Ar tifi cia lo rM ac hin e
Sm ar t
Bu ild ing
Te ch no lo gy
The 2017 Altus Group CRE Innovation Report surveyed 400 CRE C-level and senior executives globally and found there’s a big disconnect between what we’re seeing in the industry in terms of technology and innovation, and the level of understanding of what’s coming from the executives. When asked about six emerging disruptive technologies and their potential impact on the industry, only a minority of respondents recognized these technologies as having the potential for major disruptive impact:
BLD FebMar 18.indd 23
2018-02-02 3:16 PM
PROCESSES WITH POTENTIAL FOR AUTOMATION Can be fully or highly automated across all processes and workflows
Debt underwriting While certain emerging disruptive technologies are not being 61% recognized by industry executives as having the potential for maCapital markets brokerage 59% jor change, Smart Building Technology â€” which only a few years ago was perceived as largely future-state â€” is now seen by 35 per Property management 54% cent as being potentially disruptive and by 45 per cent as having the potential for significant cost savings. Interestingly, for Smart Asset management, budgeting & forecasting 59% Building Technology to maximize its potential, it needs to be Valuation & appraisal 52% heavily enabled by Big Data and Predictive Analytics, turning raw data into intelligent information for strategic decision-makAquisitions & dispositions 39% ing or for Artificial Intelligence (AI) and Machine Intelligence to automatically drive processes or improve systems. Leasing 29% Yet, only 28 per cent of executives surveyed believe AI and Machine Intelligence will create disruptive changes in the CRE industry while conversely 38 per cent said it will have little to no impact. Similarly, only 24 per cent said Big Data and Opportunities Abound for Process Automation Predictive Analytics will disrupt the industry while and Performance Management 42 per cent said it will have little to no effect. The While CRE executives remain uncertain about the effects of certain responses relating to Blockchain are even more game-changing technologies, a deeper look at four key areas reveals cursurprising with only 15 per cent of responrent opportunities and challenges CRE firms are facing: process automadents stating that it will create disruption; operational performance; integration and data; and skills and staffing. tive changes and 62 per cent believe The survey results show a significant opportunity for process automation Blockchain will have little to no impact to improve operational efficiency, with more than 50 per cent of executives staton the CRE industry. ing that most major CRE processes and workflows can be significantly or comExperts in these fields have warned pletely automated. Several areas ranked high for automation potential, espeof the disruptive impact that these cially those with a large number of processes which can be delivered faster technologies are already having on oththrough automation, and firms are realizing the benefits that automation can er industries, so CRE executives must have on efficiency, and in turn on the overall bottom line. Executives identified take notice that these new innovations Debt Underwriting (61 per cent), Capital Markets Brokerage (59 per cent), Prophave arrived and are quickly gaining erty Management (54 per cent), Asset Management, Budget and Forecasting (53 attention. Some of these disruptive per cent) along with Valuation and Appraisal (52 per cent) as processes which technologies will necessitate a dramathave the potential to be fully or highly automated across all processes and workic change in how CRE firms produce flows. Many of these processes, such as budgeting, are really time-intensive, ofand manage their data, which has the ten requiring a great deal of coordination between different parts of the busichain effect of altering job responsibiliness, and this is a key opportunity for firms to use automation to their benefit ties and in some cases, completely and modernize their organizations. The survey also asked about Acquisitions changing the roles for certain posiand Dispositions (39 per cent) and Leasing (29 per cent), however fewer respontions. Those that embrace what is comdents believe these processes can be fully or highly automated across all working will change the rules of the game by flows. The industry is ripe for automation to impact many areas, processes and disrupting traditional CRE business functions, changing the way common tasks like financing and brokerage are processes, and at the same time will undertaken today. This suggests a significant impact on the people associated gain a competitive advantage. with these processes while at the same time presents opportunity for resource reallocation to areas that will drive greater value. Performance Management also represents a significant opportunity for CRE firms, as the report identified major gaps in benchmarking in terms of Operational Expenses as well as Leasing. While 56 per cent of executives confirmed they benchmark Valuations and 49 per cent benchmark Returns, only few executives surveyed said they compare their Operational Expenses (14 per cent) and Leasing (22 per cent) against competitors, the market or industry, indicating a significant performance management shortfall. However, 69 per cent believe there is substantial potential to conduct better benchmarking around Operational Expenses, and 80 per cent around Leasing. This suggests that a deeper analysis of property expenses is an overlooked area in terms of applying analytics and monitoring and has the potential to unlock greater portfolio val-
FEBRUARY MARCH 2018
BLD FebMar 18.indd 24
2018-02-02 3:16 PM
ue. Firms should look at better expense management as low hanging fruit to drive more value; with the growing availability of tools and data to better manage performance, executive respondents are right to suggest much more can be done with expense benchmarking, and the opportunity for value creation is significant.
10 .3 %
10 .1 %
REAL ESTATE ALLOCATIONS AND PROPTECH INVESTMENT LEVEL
Major Obstacles: Integration & Staffing
Take Action to Embrace Transformative Technologies
Technological advancements are already starting to impact, enable and drive industry change in areas such as process automation and performance management. Looking down the road, many processes may be exclusively performed by artificial intelligence bots, but AI is already deeply engrained in many technologies the industry relies on today. CRE executives’ competitive imperative is to start looking outside their own firms’ boundaries to visualize and think of how technology advances will potentially change business models and even impact the industry as a whole. With the ad-
With the proliferation of new applications, there now exists a growing integration challenge that firms face in order to effectively implement new technologies. Executives already recognize data integration and standardization as key focus areas for driving operational improvements, and the increasing number of available apps will add complexity in achieving this. 58 per cent of survey respondents are using significantly more CRE-specific applications now than they were three years ago, but 59 per cent do not have significant integration between major management systems and applications. Lack of integration can negatively impact information flow and decision-making, particularly in areas such as Debt Underwriting, Valuation and Appraisal, and Capital Markets Brokerage, which were identified as functions that have the most potential to benefit from on-demand data access and analytics. Lack of sufficiently skilled IT people is another key barrier that firms face as they try to make the most of their technology and data investments, as 50 per cent of executives surveyed indicate that their firms have a shortage of technology staff. The report findings also identified a continuing skills gap for both technology and business professionals: 69 per cent of IT professionals lack in understanding of the business aspects of CRE, and 66 per cent of CRE business professionals lack in understanding of technology/IT. While new technologies have huge beneficial potential, technical staff with in depth knowledge of disruptive technologies and who also have a working understanding of CRE business practices will be a differentiating factor for firms that successfully implement and integrate these new technologies.
CRE investment allocation Proptech investment
Source: 2017 Institutional Real Estate allocations monitor (Cornell University’s Baker Program in Real Estate - Hodes Weill & Associates); Real Estate Tech Funding Reaches New Highs in 2016, CB Insights Research Briefs, Jan 2017.
vent of so many new technologies, it’s becoming more important than ever before for executives to not just keep an eye on how emerging technologies may affect their own firms, but how they may change their interactions with the processes of other segments. Some emerging disruptive technologies may seem far away from having a significant impact on the industry, however the report found that Smart Building Technology is seen as having significant cost-savings and even further disruptive potential going forward, when it was considered largely future-state and early stage just a few short years ago. Expense benchmarking is an area where firms can act now to better manage and track operational performance, and it should be a more important area of focus for both the asset and property manager. The deficit of technology staff should also be a focus area for executives as firms increase the amount of CRE-specific applications they’re using, to help ensure integration between systems and avoid data silos. CRE firms need to start looking at how their technology infrastructure will allow their processes, workflows and data to “digitally plug” into the technology advancements of the PropTech future that are now starting to come to market. b
Michael Crook is a Senior Vice President of Product Management at Altus Group. See the full report at www.altusgroup.com building.ca
BLD FebMar 18.indd 25
2018-02-02 3:16 PM
Accommodating the Disruptors To become a tech hub, cities need wages and talent, not just sexy buildings.
aterloo Region is Canada’s fastest growing tech talent market, having grown by almost two thirds over the last five years, while Toronto led in terms of the absolute growth of its tech labour pool. According to CBRE’s 2017 Scoring Canadian Tech Talent Report, Waterloo Region added 8,400 tech jobs from 2011 to 2016, a 65.6 per cent growth rate, and the second fastest rate of tech labour pool growth in North America after Charlotte, North Carolina at 77.1 per cent. However, Toronto remains the undisputed magnet for tech employers and employees, expanding by 51,300 tech jobs, a 31.8 per cent increase for the city, over the same period. “Cities across North America are jockeying for the attention of leading tech firms and it’s increasingly clear which cities are leading the pack. Waterloo Region continues to show its strength as one of Canada’s top tech markets and a major engine of innovation for the Canadian economy. Not only is it the fastest growing over the five-year period, it is also the fastest growing market year-over-year, adding 5,600 jobs alone in 2016, an increase of FEBRUARY MARCH 2018
BLD FebMar 18.indd 26
almost a third in a single year per cent,” says Paul Morassutti, Executive Managing Director at CBRE Canada. “Even after the fall of Blackberry, which was once one of Waterloo Region’s top tech employers, the region continues to benefit from clustering of the high-tech industry. Companies such as Shopify are attracted to the collaborative and competitive environment that supports entrepreneurship, innovation and development.” The report, published for the second consecutive year, analyzed 10 of Canada’s largest cities to create a scorecard which ranks their tech talent offering. The final rankings were determined based on 14 metrics, including tech talent supply, growth, concentration, cost, completed degrees, industry outlook for job growth, and market outlook for both office and apartment rent cost growth. Toronto, for the second year, clutched the top spot, while Ottawa and Vancouver traded positions, ranking second and third, respectively. Vancouver offers very high quality labour at a moderate cost to employers, however its ranking suffered as the city experienced flat tech job growth in 2016. Ottawa, on the other hand, increased its tech talent base by 11.9 per cent or 7,300 jobs over the same year, and boasts a labour force with the highest education attainment among all cities surveyed. Montréal and Waterloo Region round out the top five, with Waterloo Region climbing three ranks from last year. Calgary, Edmonton, Halifax, Winnipeg and London were ranked six to 10. Landlords are competing for tech tenants and are most successful when leasing existing character-filled, brick and beam buildings. As supply dwindles, landlords are increasingly defixturing office towers to fashion desirable office space in amenity-filled neighbourhoods. That said, while physical real estate is an important component of tech companies opening and expanding operations, access to talent and wages are much more significant when making locational decisions. Cost of real estate average six per cent of typical company overhead and labour costs account for 60 to 70 per cent, with tech workers commanding, on average, 40 per cent more than non-tech workers in Canada. Taking both talent and real estate costs building.ca
2018-02-02 3:16 PM
By attracting tech talent, Waterloo Region is also attracting tech developers. s2e Technologies together with Sifton Properties are building West5, a planned community covering 70 acres in London, Ont., with 2.5 million square feet of integrated mixed-use buildings. The project was recently awarded a 2017 Smart Energy Communities Award by Quest (Quality Urban Energy Systems of Tomorrow) and will, when fully constructed, generate almost all of its own energy.
Source: CMHC,Statistics Canada, CBRE Research, 2016
into consideration, a typical 500-person tech company in 75,000 square feet of office space in Canada can expect total annual costs to range from $33 million in London, the least expensive Canadian city, to $43.9 million in Calgary, the most expensive market. For contrast, Oklahoma City is the cheapest U.S. market at $43.3 million, more expensive than every Canadian city except for Calgary, demonstrating the relative value for international tech firms looking to locate in Canada. “Although value continues to influence office location decisions, tech companies are putting more stock on the availability and concentration of quality talent. Ottawa, Waterloo Region and Toronto all offer the highest concentration of tech talent, with tech jobs in Ottawa accounting for over one-in-10 of all jobs in the city. These were also the fastest growing markets in 2016. As the influence of tech among all industries rises, and the battle to attract and retain tech talent is no longer fought by traditional tech firms alone, it’s no surprise com-
panies are willing to embrace higher costs in order to be where the talent is,” says Morassutti. “For global tech firms looking to grow in North America, Canada provides the best bang for their buck. Canadian cities offer companies highly educated talent pools and immigration policies that allow for the recruitment of the best talent from around the world, lower salary costs and all with the benefit of a discounted Canadian dollar versus the U.S. dollar.” b
Apartment rent-to-tech wage ratio market Vancouver Toronto Halifax London, Ont. Edmonton Waterloo Region, Ont. Winnipeg Ottawa Calgary Montréal
annualized apartment rent ($)
average annual tech wage ($)
14,676 14,796 11,844 11,016 13,716 12,084 11,124 12,876 13,356 9,120
rent-to-tech wage ratio (%)
ratio YoY bps change
79,402 18.5 -40 82,385 18.0 10 70,227 16.9 50 66,305 16.6 0 89,363 15.3 150 78,797 15.3 30 73,406 15.2 -40 85,421 15.1 20 92,236 14.5 160 76,519 11.9 50 building.ca
BLD FebMar 18.indd 27
2018-02-02 3:16 PM
S I T E
Creative Collide CLOCKWISE FROM ABOVE:
Located at the entrance to MacEwan Universityâ€™s Edmonton campus, Allard Hall is clad entirely in high tech tempered glass with energy-saving tints and fritting. A new urban home for the formerly suburban Faculty of Fine Arts and Communication, its galleries and multiple theatres will see extensive evening use by the general public. At centre is a multi-story skylit double atrium crossed by dramatic angled pedestrian bridges, with cultural production and instructional spaces arrayed around them, faculty offices at the perimeter.
FEBRUARY MARCH 2018
BLD FebMar 18.indd 28
2018-02-02 3:17 PM
Marking one of Bing Thom’s final projects, Allard Hall opens at MacEwen University 29
Photography by Ema Peter
By Shannon Moore Creativity flourishes when different disciplines collide. This is the intent at MacEwen University in Edmonton, where fine arts and communications students are encouraged to converse in a new building designed with culture and collaboration in mind. The new 430,000-sq.-ft., $143-million Allard Hall is situated on the university’s downtown campus. Designed by the late Bing Thom in association with Manasc Isaac Architects, the educational facility is clad in high-performance tempered glass with bright green accents on its exterior. Inside, angled staircases crisscross like branches on a tree, forming nest-like nooks where students can sit, study and socialize. The design team recognized the need for a variety of creative spaces, and established the nests as a series of unconventional areas outside of the traditional classroom. “The stairs do more than just connect the various levels of the building,” says Venelin Kokalov, design principal at Revery Architecture (formerly Bing Thom Architects). “They create meeting points that bring students of different disciplines together, resulting in infinite opportunities to activate the space.” Though the building originally had a curvier exterior, its façade was streamlined to meet budgetary needs. “Some changes to the design presented challenges during construction, but our team was resourceful and resilient,” says Andrea Flynn, project manager at Revery Architecture. “We were able to bring the project to realization with its main spirit still intact.” To bring fluidity from the revised exterior to the rest of the building, the design team included similar shades of green inside. In addition to an art gallery and recording studio, the building contains a 419-seat theatre, 215-seat recital hall, and a sky-lit atrium that doubles as a performance space. “The intent here was to entice professional artists and members of the public to visit the building,” says Flynn. “The informal performance space brings exposure to the students and serves as a platform to showcase their talent.” Named after the Allard family, long-time supporters of the university, Allard Hall marks one of Bing Thom’s final projects with the firm. A celebrated Canadian architect and urban designer, he passed in 2016. From the outset, Thom’s vision was to fashion a building where students could exchange ideas. His legacy will undoubtedly prevail through the inclusive and educationally supportive Allard Hall, where creativity and collaboration thrive. b building.ca
BLD FebMar 18.indd 29
2018-02-02 3:17 PM
V I E W Walk With Joy ULI Toronto’s Executive Director thinks it’s time to shake ourselves out of a transit-advocacy coma. By Richard Joy
It’s been a while, but frustration with transit gridlock in the Toronto Region is finally boiling over again. Distracted by the shiny objects of Toronto Mayor John Tory’s “Smart Track,” and the provincial government’s expanded version of this idea — the full electrification of the diesel commuter network — transit advocates went into a fouryear hibernation. No doubt the fatigue of several bold and failed attempts to deal with regional transit’s number one challenge, dedicated taxes, contributed to this deep sleep. In this vacuum of advocacy, funding for transit operations has flatlined, as has ridership. While mounting evidence piles up against the Scarborough subway screw-up, politicians of all stripes have doubled-down on a plan that cannibalizes higher priorities such as Scarborough LRT, the eastern relief line, and waterfront transit. Even pleas for the simple coordination of the 10-year reviews of the province’s regional growth plan and Metrolinx regional transportation plan were ignored, resulting in two plans that barely speak to one another. Incredibly, the resulting vision out to 2041 is to tread water with a formal goal to freeze the percentage of ridership, not increase it. To pull us out of this dangerous slumber, the Toronto Region Board of Trade is ringing an alarm bell which has the potential to reignite critical discussion about how we must fix our region’s mobility crisis. The Board is offering up a range of prescriptions to address the multiple challenges of funding shortages, systems coordination, fare integration, technology implementation, and the leveraging of real estate development. While the Board’s marque idea to upload and amalgamate the region’s transit authorities into one provincial crown corporation could create more problems than it solves, its intentions are noble. We absolutely need to elevate the structures and supports around regional transit well beyond the status quo patchwork of collective failure. In getting governance right, we truly need a made-inToronto model that reflects the very unique fabric of our urban region that is a hybrid of pre-war city and car dependent post-war suburbia. Unlike transit systems in Asia FEBRUARY MARCH 2018
BLD FebMar 18.indd 30
and Europe that service high density and transit-oriented metropolises throughout, the urban structure of the Toronto region is very asymmetrical. Nowhere is this urban lopsidedness more obvious than transit. Over 80 per cent of ridership is concentrated in the central city with much less than 50 per cent of the population and just nine per cent of the total urban area. As such, there is merit in the idea that we maintain both local and regional transit authorities, and not sacrifice the former to fix the latter. Importantly, the Board is seeking to revive the role of municipal leadership within the regional transit equation. Unbelievably, not a single mayor or councillor today wakes up in the morning with any responsibility to think or act regionally — not on transit or any other area of jurisdiction. It’s a fact that has no doubt contributed to the alarming parochialism plaguing regional progress. Perhaps the most important recommendation of the Board’s advocacy is the focus on the opportunity to leverage real estate development around transit infrastructure. This priority was the overwhelming consensus of an expert panel discussion the Board recently hosted. It’s an idea, however, that doesn’t necessitate the full amalgamation of all transit operations and capital investment: it could easily become a function of the existing Metrolinx model. Surprisingly downplayed is the need for significant new dedicated tax revenue sources, once the centrepiece of the Board’s transit advocacy. Nothing threatens the opportunity to reverse the Richard Joy is Executive decades-long neglect of transit infraDirector of ULI Toronto. structure than the ongoing underPreviously, he served as funding of capital and operating needs Vice-president, Policy and in all parts of the region. No amount of Government Relations at land-vale capture extracted from tranthe Toronto Board of sit oriented development — or debt fiTrade, and was the nancing — will negate the need to seDirector of Municipal cure massive new funding sources. Affairs and Ontario At the end of the day our municipal (Provincial Affairs) at and provincial governments are acGlobal Public Affairs. countable for fixing regional gridlock, Follow him on Twitter not lobby groups. But governments @RichardJoyTO or email rarely do right without a push by exat Richard.Joy@uli.org ternal stakeholders. In this context — and in this double election year — the Board of Trade’s re-emergence into the realm of regional transit advocacy offers to wake up a regional priority at a most critical time. b
2018-02-02 3:17 PM
For the latest Building news and views visit:
BLD FebMar 18.indd 31
2018-02-02 3:17 PM
S PA C E MATTERS Creating public and amenity spaces in residential and multifamily developments is essential for modern communities. Our full line of architectural pavers and retaining walls, offer unique, beautiful and durable solutions. The team at Unilock has been trusted for over 40 years to provide technical expertise and project support in the exploration of segmental paving product options.
PROJECT: The Preserve. Oakville, ON DESIGN: NAK Design Group PRODUCT: Artlineâ„˘ with UmbrianoÂŽ and Smooth Premier Finishes
Contact your Unilock Representative for samples and product information for your team. In Quebec, please contact Rocvale, 1-800-946-2797, for all your Unilock product information.
Building Magazine_February_2018.indd 1 BLD FebMar 18.indd 32
2018-01-30 9:35 AM 2018-02-02 3:17 PM
Canada’s national news magazine for building industry professionals with focus on real estate development and architecture including residen...
Published on Feb 8, 2018
Canada’s national news magazine for building industry professionals with focus on real estate development and architecture including residen...