CAM August 2015

CANADA’S NATIONAL PUBLICATION FOR APARTMENT OWNERS AND MANAGERS

VOLUME 12 / NUMBER 3 / AUGUST 2015

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What’s Trending in Amenities Pet services Understanding seniors’ needs Revitalizing older buildings

HITTING A

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HIGH NOTE

PA R T O F T H E

Concert’s Rod Pirie takes us behind the scenes at Motion

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Editor’s Note

Better service, more space

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With summer winding down and the whiff of autumn in the air, preparing for the coming cold is on the minds of most property managers. But given fall is a temperate season, outdoor spaces like patios and swimming pools will continue to see plenty of action.

Whether your property is a downtown mid-rise or a tower in the suburbs, residents value the additional space amenities offer and some features of your building will never go out of style.

From pet services to fitness rooms, in today’s competitive rental market, offering residents what they want is critical. And, given shrinking suite sizes and the changing needs of tech-savvy tenants, additional space to relax and play has trumped the once all-important parking.

Balcony safety has been a popular topic lately given the multitude of tragedies we’ve read about in the news. According to J.P. Trottier, Public Information Officer with Ottawa Paramedic Service, accidents related to windows and balconies continue to be of concern well into October. Read our balcony safety feature on page 18 to brush up on your responsibilities as a landlord, while also learning some prevention tactics that could save you from being at the centre of just such a disaster.

Where amenities are concerned, no one understands their importance more than our issue’s Industry Influencer. Rod Pirie, Director, Property Management at Concert Realty Services has been overseeing day-to-day operations at Motion, one of Toronto’s most coveted new rental towers, since it opened its doors in 2013.

Find out what amenities he says are the current must-haves and what features will be in hot demand in the near future.

Sincerely,

Editor

Erin Ruddy

Associate Publisher

Senior Designer

Mitchell Saltzman

Designer

Jennifer Carter

Production Manager

Rachel Selbie

Annette Carlucci

Production Coordinator Karlee Roy Contributing Writers

aula Gasparro, Derek Lobo, P Jessica Green, Richard Vilner, Chaim Rivlin, Andy Schwartze, and Chris Seepe

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CONTENTS COVER STORY 22 Industry Influencer

Concert’s Rod Pirie takes us on a behind-the-scenes tour of Motion in downtown Toronto

FEATURES 16 Reinvesting in Toronto’s Aging Rental Towers

By Erin Ruddy

By Erin Ruddy

COLUMNS 10 Transactions GTA Multi-residential Market Summary

By Richard Vilner 12 CMHC New and Emerging Trends in Seniors Housing

By Paula Gasparro 18 Newsworthy Balcony Mishaps in Residential Towers

By Erin Ruddy 28 Portfolio Aiming for Above Average

By Derek Lobo 30 Management Amenities for All in 2015

By Jessica Green 34 Insurance Let’s Talk Cyber Safety

By Andy Schwartze 36 Marketing Lobbying for Lobbies

By Chaim Rivlin

DEPARTMENTS 4

Editor’s Note

20 Ask the Expert 38 Smart Ideas

COLUMNISTS Paula Gasparro, Jessica Green, Derek Lobo, Andy Schwartze, Richard Vilner

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THIS MONTH’S ONLINE EXCLUSIVES ALL THE BUZZ

Canadians buy into U.S. multi-family market Canadian investors poured approximately U.S. $1.3 billion (CAD $1.7 billion) into U.S. multifamily acquisitions in the first half of 2015, representing more than 30 per cent of foreign investment in the sector.

Real estate analysts foresee tougher competition for traditional skyline icons.

FROM THE GREEN BIN

The legalities of live-in caregivers in condos The aging demographic in condominiums will present a new set of challenges for condominium corporations. Notably, as senior residents continue to grow older, many will choose to hire live-in caregivers to look after them.

Virtual reality emerges in commercial sector Sun streams through the windows, stretching across a white-tiled lobby floor of an office building. Modern light fixtures descend from high ceilings, above slightly cushioned orange leather couches and abstract paintings.

Distributors urged to cut losses with proactive investment in climate change adaptation.

EXPERT ADVICE

Three highlights of switching to LED fixtures: An expert illuminates the benefits of a lowcost, high-impact facility upgrade.

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Transactions

GTA Multi Residential Market Summary

By Richard Vilner

RealNet Canada Inc. announced 2015 second quarter results for the Greater Toronto Area commercial real estate and land investment markets. After a sluggish opening three months in the GTA, the second quarter rebounded convincingly to reach its fifth best quarter all-time in dollar volume, totaling $3.6 billion. This represents gains of 38% and 28% versus the same period one year ago and the ten-year quarterly average respectively, according to the RealNet Index. This was driven in large part by a record number of transactions in the quarter (595), which led to gains in every sector when compared to Q2-2014, and a record performance in the residential land sector.

The apartment sector contributed $471 million, or 13% to the overall quarterly total, with a total of 56 multi-residential properties trading in excess of $1 million during the April to June period. On a dollar volume basis, this represents an increase of 44% compared to the first quarter, and an increase of 57% compared to the same period a year ago. On a year-todate basis, the apartment sector has totaled $799 million, 60% greater than the first six-month period in 2014.

During the second quarter, there were a total of ten multiresidential property transactions in excess of $10 million throughout the Greater Toronto Area combining for $357 million, and having an average price per unit valuation of $221,532. The largest apartment transaction involved a 60% interest sale in three towers within High Park Village, consisting of 750 units for a total of $104,574,797, resulting in an adjusted price per unit valuation of $232,388.

Top 5 Apartment Transactions Q2-2015 Date

Building

Municipality Price

Units Price/Unit

30/06/2015

High Park Village: #2, #4, #6

York

$104,574,797

750

$232,388

10/06/2015

2770 Aquintaine Ave

Mississauga

$52,300,000

180

$290,556

30/04/2015

25 Fisherville Rd.

North York

$42,775,000

214

$199,766

11/06/2015

The Brock

Burlington

$39,850,000

115

$346,522

07/04/2015

103 Avenue Rd.

Toronto

$36,200,000

125

$289,600

So far, year-to-date, yields continue to compress across the commercial real estate market throughout the Greater Toronto Area, with the apartment sector recording the lowest among all asset classes at 4.57% on average. This represents a substantial decrease when compared to the average capitalization rate in

10 www.canadianapartmentmagazine.ca

2014 of 5.04%. In addition, the year-to-date average per unit valuation has reached $206,921 per unit, which has increased by 7% and 48% from the 2014 average of $193,577 and the tenyear average of $140,075, respectively.

New & Notable Transaction

Q2-2015 Quarterly Breakdown

118 & 120 Pembroke Street, Toronto Located north of Dundas Street East and east of Jarvis Street, this property is improved with a three storey apartment building containing a total of eight units. The property was constructed in 1906 and renovated in 2010. The apartment building was purchased for a total consideration of $2,800,000, representing a price per unit of $350,000.

Date of Sale: July 22, 2015 Sale Price: $2,800,000 Capitalization Rate: 4.83% Total # of Units: 8 Price per Unit: $350,000 Brokers: Commercial Focus Realty Inc. and Royal LePage Signature Realty

This chart summarizes, on a quarterly basis, the total dollar volume and the total number of apartment transactions greater than one million in the GTA region. Q2-2015 reached $471 million, with a total of 56 assets trading above $1 million.

Q2-2015 Transactions Bubble Chart

This chart summarizes second quarter apartment transactions greater than $1 million in the GTA region geographically and by dollar volume (the larger the transaction in dollar volume, the larger the size of the circumference).

This transaction was brokered by Commercial Focus Realty Inc. and Royal LePage Signature Realty. The building was on the market for approximately four months and had an original asking price of $2,899,000. The vendor purchased this property in February, 2010 for a total consideration of $1,336,000, representing a price per unit of $334,000.

This article was written by Richard Vilner, Research Manager at RealNet Canada Inc. RealNet Canada Inc. (www.realnet. ca) is the leading real-estate information services company in Canada. Founded in 1995, The Company’s core information product provides coverage in both the commercial real estate investment and residential development markets, powering the decisions of firms involved in approximately 75% of the market activity. RealNet Canada Inc. is an Altus Group company (www.altusgroup.com) August 2015 11

CMHC

New and Emerging Trends in Seniors Housing With Canada’s Aging Population on the Rise, Real Estate Developers Should Take Note of this Active (and Demanding) Demographic

By Paula Gasparro

Older Canadians represent an increasingly important segment of the Canadian population for developers, organizations and property managers that provide housing. Not only will the number of Canadians over the age of 55 continue to increase over the next several decades, creating a growing demand for new and innovative types of housing, but this group possesses characteristics that are more diverse than any previous generation of seniors. The desire to “age in place,� however, whether in the family home or in a familiar neighbourhood, seems to be a sentiment shared by most Canadians.

12 www.canadianapartmentmagazine.ca

CMHC

Developers, sponsors and property managers planning housing targeted to Canada’s 55plus population should also consider the new and emerging trends described below, which present both challenges and opportunities.

Commitment to environmental sustainability and energy efficiency With increased competition driving the pursuit of efficiency, operators of retirement homes and long-term care facilities are looking for ways to improve the environmental sustainability of their projects while lowering their utility costs.

professionals, helps to ensure future referrals of new residents.

More flexible, welcoming and accessible building designs In contrast to the institutional feel that characterized many “old folks’ homes” of the past, seniors’ residences today offer larger suites and more common areas. Some

contemporary retirement homes resemble hotels more than the nursing homes of previous generations. These buildings offer increasingly sophisticated fire and safety systems, better heating and cooling, and advanced communications and emergency response technologies. In the long-term care sector, new design standards and models are leading to the creation of friendlier, less

More diversified amenities Older Canadians are increasingly demanding more diversified programs and amenities and service packages that offer greater independence, partly because of the changing demographic profile of seniors housing projects. Most retirement homes and other seniors’ housing developments today provide accommodation primarily targeting women, with programming and amenities designed around their needs. As more men enter seniors housing projects, activities need to be planned that take their needs into account.

Moreover, the generation now entering retirement is, on average, better educated and more active and healthier than previous generations of retirees. The programming that appeals to them is very different from the programming that would have appealed to their parents.

Greater emphasis on marketing and promotion With greater competition in the marketplace, developers, sponsors and property managers are increasingly looking for more innovative ways to market and promote their accommodation.

While brochures and flyers still remain important tools, operators are increasingly turning to the Internet to create awareness, especially among the adult children of seniors, who can influence the decision to move.

With the expanding range of residences and programs being offered, it is necessary to educate consumers on the choices available and dispel the image of old-fashioned seniors’ homes. Effective marketing also helps reduce the time to achieve lease-up. Finally, effective marketing in the local community, through market positioning, understanding local needs and good relations with local health

August 2015 13

CMHC institutional residences where the residents can better cope with their limitations and can do so with more dignity.

Buildings designed and constructed today are also more flexible than buildings in the past and can change and adapt as the market evolves. For example, movable partition walls can be adjusted for changing office and staffing requirements.

Pre-installing plumbing runs to permit

flexibility for shifting the unit mix, conduits for emergency response systems and automatic door openers; roughing in the future ability to install elevators; and blocking for the future installation of grab bars are also simple and relatively inexpensive steps at the construction stage.

So, too, is creating room sizes, doorways and hallways that can accommodate wheelchairs and special equipment, which

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can be added if and when required. Thoughtful design during the initial construction stage can facilitate future retrofitting while camouflaging full accessibility, which may appear institutional to those not immediately in need. While expanding the overall floor area and adding materials may increase initial construction expenses, these pale in comparison to the cost of major renovations in the future.

Developing projects around the principles of universal design is also becoming more commonplace. Universal design, sometimes known as barrier-free building design or inclusive design, is the design of products and environments to be usable by all people, to the greatest extent possible, without the need for adaptation or specialized design. The intent of universal design is to simplify life for everyone by making products, communications and the built environment more usable by as many people as possible at little or no extra cost. Universal design recognizes that people have a range of capabilities and that the designs of buildings and tools should reflect this range. In most cases, achieving universal design entails small changes, such as lowering light switches, raising electrical outlets, installing lever door handles instead of door knobs or providing features such as adjustable closet rods or kitchen counters.

Improvements in technology, treatments and options Continuing improvements in technologies, features and options for seniors include sophisticated resident tracking and emergency response systems, enhanced ventilation systems, anti-microbial carpets, new food preparation systems, and computer-based monitoring and communications systems. The increased use of the Internet has also led to the introduction of computers and wireless networks as standard components in the design of new residences.

As well, to take into account the increased reliance on motorized scooters, developers now have to provide for scooter access, parking and recharging.

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Feature

Reinvesting in Toronto’s Aging Rental Towers How the Tower Renewal Project is Helping Revitalize the City

By Erin Ruddy

High-rise apartment buildings are permanent fixtures in Toronto’s rapidly changing landscape. But, from the inner-suburbs to the outer perimeter of the city’s ever-expanding sprawl, these mostly brown concrete blocks, born out of post-war expansion, are hardly seen as architectural jewels.

16 www.canadianapartmentmagazine.ca

Feature In the 1950s through 70s, advertisements lured starry-eyed tenants with images of chic couples and young professionals enjoying the types of extravagant amenities once reserved for the rich and famous. Known as “Towers on the Park,” they promised a better life—a quiet suburban existence in elegant rental suites overlooking resort-like grounds, just a fiveminute drive to anywhere.

Skip ahead thirty or forty years and the reality is much starker. In the shadows of Toronto’s shiny new condominium towers, the old apartments look lackluster at best. Words like “luxury” have long since dropped from the vacancy ads. Restrictive zoning prohibits commercial development on the properties, effectively isolating tenants from the shops, restaurants and essential services that define most energetic neighbourhoods.

“One of the big issues with these towers is that they were never intended for the demographics we are seeing in them today,” says Graeme Stewart, a registered architect and associate with ERA Architects, and a key initiator of the Tower Renewal Project. “They have become landing pads for newcomers to Toronto. On the one hand, this has helped immigrants by creating a readystock of affordable housing. On the other hand, it’s created barriers. Convenience wasn’t part of the original plan, and nor were large families. The buildings were intended for young couples and professionals seeking a quiet suburban existence; for people who owned cars.”

Stewart points out that unlike most cities in North America, Toronto’s apartment buildings are not concentrated in one central downtown neighbourhood. “If you include Hamilton and Oshawa, we have about 2,000 aging high-rise apartment buildings spread across the region, in places only accessible by bus (not subway).

This is a huge amount of housing stock and one that we can’t afford to lose. About one million people live in these towers.”

Of course, the lack of transit is just one obstacle facing tenants and management— sub-par living conditions, inefficient building systems, high unemployment rates and security issues are also taking a toll on the communities.

But, as Stewart points, changes are happening. In the past five years, he’s seen

several property owners reinvest in their older buildings via energy-efficient upgrades, improvements to units, and the addition of community-enhancing amenities.

“Some are making the upgrades and we’re seeing the results. But most, particularly those in the outer reaches of the city, are at that stage where they need reinvestment,” he says. “The good news is, there is huge opportunity to reimagine these vertical communities and how to best use the open space around them to meet future needs and growth.”

How the Tower Renewal Project began The pilot project for Tower Renewal came about in 2008, initiated by former mayor David Miller. It began as a program to encourage apartment owners to retrofit their aging towers for improved energy efficiency.

But, despite noble efforts to kick-start the program, it got very little support. Building owners at the time had no incentive to undertake these very expensive retrofits given rent-control regulations were so stringent, and zoning prohibited them from having any commercial uses that might help finance the upgrades.

Fortunately, the rules have since changed.

“Zoning has been approved by council and should be legal by the end of the year,” says Stewart. “This should allow for new uses in dense tower neighbourhoods, like Scarborough and Etobicoke, making small businesses, food trucks, barber shops, after school programs and other essential services available right on the property.”

Today, the Tower Renewal Project’s growing list of partners includes the City of Toronto, CMHC, the University of Toronto, and the United Way among others. Beyond upgrading for energy efficiency, the project examines the heritage and histories behind the buildings while striving to ignite future potential in a green and equitable Toronto.

In a publication posted on its website, the City has outlined a ten-year strategy highlighting proposed goals and outcomes based on the project’s current resources. To date—though some progress has been made with about 300 sites already reaching out to receive action plans for “measured and substantial” improvements—there is still much to be done.

“Through a collective effort between owner, the City, and non-profits, these

Goals & Outcomes of the Tower Renewal Project: • A cleaner and healthier city environment • Social and cultural benefits supporting stronger communities • Enhanced local economic activity, resulting from comprehensive and transformative change

dense, vibrant neighbourhoods could emerge as community hubs,” says Stewart.

“We could see them evolve in unique ways, each different from the other. While some might become great destinations for foodies, others might become draws for their markets or community centres.

Childcare could be provided on site. More diverse housing could be offered, like townhouses for growing families who want to remain in the community.”

What is certain, Stewart says, is that over time, as more improvements are implemented and these towers are re-imagined for their future potential, there will be cleaner, safer and more appealing apartment neighbourhoods across the city, and the whole city will benefit.

How the Tower Renewal Project works According to the City’s website, Tower Renewal is a program to drive broad environmental, social, economic, and cultural change by improving Toronto’s concrete apartment towers and the neighbourhoods that surround them.

Building owners interested in taking improvement steps are shown how to incrementally build capacity to undertake more substantial projects, which will lead to energy efficiency, utility savings and improved living conditions for tenants. From deep retrofits, like building envelop cladding and high efficiency heating systems, to adding herb gardens, murals, and playgrounds for kids, the program identifies action steps that can be taken toward complete revitalization: “Although challenging, it is technically and financially possible to make the buildings, sites and communities perform to as high a standard as newly constructed facilities. It is the goal of Tower Renewal to support this transformative change.”

August 2015 17

Newsworthy

Balcony Mishaps in Residential Towers Due Diligence and Education are the First Steps in Preventing Tragedy

By Erin Ruddy

On July 5th, 2015, a 19-year-old woman was critically injured after falling from a fourth-floor apartment balcony in southeast Ottawa. Reports suggest that the railing had become dislodged, resulting in the tenant’s 15-metre drop to the concrete ground below. Fortunately her condition has steadily improved, but that’s not always the case.

Stories of fatalities due to faulty balcony railings, structural deterioration, and unsafe behaviour are rampant in the news. In June, the world mourned the loss of six young Irish students who died after a fourthfloor balcony collapsed during a party at Library Gardens complex near the University of California’s Berkeley campus.

Following the tragedy, investigators noted that the building code for 2007 (the year the building was constructed) would have included a 60 lbs-per-square-foot rule for the balcony. With 13 people on the 5-by10-foot concrete structure, some authorities surmised that it may have been overloaded, causing the platform to separate from the stucco wall and collapse. Others speculated about the “run-down” conditions of the apartment building as a whole.

18 www.canadianapartmentmagazine.ca

Since then, an investigation by the city of Berkeley has determined that “severely dry rotted” timber contributed to the tragedy and a criminal investigation has been launched to assess whether shoddy construction was a factor.

A spokesperson for Segue expressed condolences while emphasizing the company’s flawless track record: “As part of the Northern California community for more than 20 years, Segue has constructed more than 6,000 apartments across the region.

We have never had an incident in which a member of the public was injured as a result of construction defects after a project was completed and we are shocked and saddened by the loss of life and injuries that resulted from this tragic accident.”

Newsworthy But a clean track record isn’t enough to vindicate a company if found criminally responsible. To put it simply, Landlord Lawyer Ike J. Awgu, B.A., J.D. comments: “Safe balcony conditions are akin to safe driveway or walkway conditions. If a tenant slips and falls because you’ve failed to keep your driveway free of ice or snow, you as the landlord will be liable.

In a similar vein, if a tenant falls off a balcony because of improper construction, you, again, as the owner or builder, will similarly be responsible.”

Balcony safety basics Construction defects and faulty railings aside, news of balcony and window-related accidents, particularly among small children, are enough to strike fear in any residential property manager.

“Every year we see maybe eight or 10 of these accidents in the late spring to early fall,” says J.P. Trottier, Public Information Officer with Ottawa Paramedic Service. “And for the most part, they are related to children falling from windows.”

Trottier says that in the warmer weather, tenants tend to leave heavier doors open for airflow, forgetting that flimsy screens are not strong enough to contain young kids who are notoriously curious. “They will climb up on anything—any piece of furniture placed near a window in order to see outside, and a little force is all it takes to push through a screen.”

Tragically, many accidents do happen this way, and through no fault of the tenant or landlord, but there are steps that can be taken to prevent them. Ensuring structural integrity by conducting frequent inspections is just one way to regulate safety; being proactive in the form of educating tenants is another.

“Provide everyone with an information package outlining the dangers that windows and balconies pose, along with tips for keeping kids safe,” advises Trottier. “Put a process in place so tenants know what to do if they notice rust or a missing bolt, anything suspicious that might indicate structural integrity has been compromised or maintenance is required.”

Mechanisms that limit doors and windows from opening should be placed on all windows and balconies at least two metres above ground. Often called “Limiters” they are effective devices that only allow for a maximum opening of 10 cm. “Even the end of a hockey stick can be used to prevent doors from sliding open,” Trottier notes, “so you don’t have to spend a lot of money.”

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August 2015 19

Ask the Expert

The Bottom Line on Modular Construction

Denis Jones, President and CEO of Auctus property fund, Knysna Management Group and Deveraux Developments

New for 2015, there seems to be a surge of interest in modular apartment design. To shed some light on this trend, we spoke to Denis Jones, President and CEO of Auctus Property Fund, Knysna Management Group and Deveraux Developments, a diversified group of companies involved in the construction and management of multi-family apartment complexes, based in Regina, Saskatchewan.

What are the main benefits of modular apartment design?

The overall benefit is the reduction in construction impacts due to the shorter on-site construction time. This means less area disruption, waste, traffic, noise pollution and fewer concerns and delays related to weather. Other benefits include: • Superior construction – the factory environment enables controlled elements that lead to more precise building methods with high quality materials.

• Energy efficiency – the use of highly efficient products and materials and a tighter building envelope allow for less energy wastage.

• Durability – modules are built to withstand the transportation and crane process and are thus more robust than standard wood framed buildings.

• Quality assurance – the factory environment allows for more stringent monitoring and inspection during each phase of construction.

• Improved air quality – the use of low VOC paints, primers, and adhesives means better indoor air quality.

• Timely construction – both on-site and off-site work can take place at the same time, resulting in substantial savings in construction time and ultimately in costs

20 www.canadianapartmentmagazine.ca

What are the challenges?

The main challenge is the compressed timelines. Modular construction requires strict schedule adherence given the compressed on-site construction time.

It also requires modular expertise, and finding experienced personnel in this method of construction can be challenging. We have addressed this challenge by developing ‘in house’ expertise, attracting and then retaining skillful supervisors.

What are the environmental impacts?

There are three areas in particular modular design is seeing environmental benefits over traditional on-site construction.

• Recycling programs – the modular factories have a construction material recycling program to reduce and reuse any waste products.

• Building envelope improvements - the exterior envelope and insulation systems between walls and floors/ceilings is superior, thus increasing heating and cooling system efficiencies.

• Better air quality – with reduced exposure to weather elements, the building materials do not present any mold, mildew or other possible indoor air pollutants.

How are building amenities factored into the process?

All standard amenities and design options can be considered and planned for in modular construction. Some limitations exist due to the dimensions of the modules and transport regulations, however creative design and architecture can account for these. All fixtures and interior design elements are top quality, compliant with building code and can be specified to the level of quality desired by the customer.

What would the cost savings be on a typical six-storey apartment?

Saskatchewan has yet to pass the building code modification for six-storey wood framed construction, but we anticipate this in the coming year. The cost to construct a modular apartment is mostly on par with standard wood framed structures on a cost-per-square foot basis. The ‘savings’ are realized in time to construct—overhead costs, interest charges, and money not earning income for investors.

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Industry Influencer

A NOTE ABO THE REST

By Erin Ruddy

Founded in 1989, Vancouver-based Concert Realty Services is a multifaceted company with operations in British Columbia, Alberta and Ontario. To date, Concert has completed more than $2.5 billion worth of projects, developed more than 10,000 rental and condominium units, and built and acquired more than 10.7 million square feet of income-producing properties.

22 www.canadianapartmentmagazine.ca

Industry Influencer

OVE Overseeing Toronto’s purpose-built rental portfolio is Rod Pirie, Director, Property Management. For this issue, which focuses on amenities, Rod took Canadian Apartment Magazine on a behind-the-scenes tour of one of Concert’s prized purpose-built apartment towers, Motion. Centrally located and packed with high-grade, resident-friendly features, it’s not hard to believe the 29-storey tower hasn’t had a vacancy in its two-year history—or that Concert’s other new apartment towers are experiencing similar success.

We spoke with Rod about what makes an apartment building work and how he came to find himself in the business of property management.

August 2015 23

Industry Influencer

How did you get your start in the property management industry?

I got my start by sheer accident. As a student, I used to spend my summers working for our family business. One year, my father bet me that I couldn’t find another job. I took that bet and found work with a small building owner and operator called Boardwalk Properties Limited, in Calgary. For two summers I worked there—landscaping, cleaning, painting and renovating units as they turned over. I was exposed to almost every part of the property management business, in and out of the office. In April, 1988, I graduated and joined Boardwalk as a property manager. The company grew into Boardwalk Equities Inc., a public company, and I grew along with them becoming the Vice President of Property Management and an Executive Officer. In 1999, I moved over to Minto in Toronto as the Vice President of Canadian Operations. In 2001, I retired and spent the next eight years with my young family. In late 2009, I decided I wanted to get back in the property management 24 www.canadianapartmentmagazine.ca

Industry Influencer

Patios, games rooms, and lounges offering free WiFi are just a few of the amenities offered at Motion, One32 and Palomar at Village Gate West.

game, and Concert Properties gave me that opportunity. I began managing their Toronto portfolio of new, purposebuilt rental buildings, and have seen the portfolio grow to over 2,100 units.

The purpose-built rental scene is surging all across Canada. Tell us about Motion and what makes it stateof-the-art.

Motion is a luxury, purpose-built rental building offering residents a lifestyle on par with any newly constructed condominium.

Our units are modern and efficiently designed. The building has a state-of-theart mechanical and BAS system that is highly efficient and helps minimize utility consumption. We have green roofs and a water retention system for irrigation. This reduces heat loss and recycles rain water to lessen our impact on the city’s water system while also reducing our utility costs. Motion is the first new, purpose-built residential building in Toronto to have a “Garbage Lounge” rather than garbage chutes. Residents bring their garbage, recyclables, and organics to the lounge,

helping maximize our recycling potential and reduce unwanted waste and expense.

In the broader sense, what makes Concert unique in the marketplace?

Concert’s focus on superior customer service and quality purpose-built and operated rental homes sets us apart from our competitors. We provide real value to our residents. We have 24-hour on-call service and a dedicated onsite management team at each of our properties. Additionally, all our buildings are conveniently located within minutes from transit lines throughout the city. We strive to provide our customers with a place they can call home, with a community feeling within the existing community that our properties are located in.

This issue of Canadian Apartment focuses on amenities. Describe some of the amenities available at Motion and your other properties.

Motion is equipped with multiple amenity spaces totalling 14,455 square feet, and 10,664 square feet of retail space. On the

ground floor, our five retail tenants provide dining, esthetic and banking services to our residents. We have ample bicycle parking, a generous amount of car parking, and three ZipCars available to those with memberships. On our upper floors we have a large party room equipped with a full kitchen; a BBQ terrace with four Weber barbecues; a resident lounge with free WiFi; and a communal games room. One of our most popular amenities is our state-of-theart theatre room featuring full-size rocker seats and a 6’x9’ wall screen. Another popular space is the fitness room, which is open to residents 24 hours. The building also has a library, private meeting rooms and a large sunny terrace overlooking City Hall and the downtown skyline. All the amenities can be booked for private functions at no additional cost.

Given Motion’s downtown location, are your residents mostly students and young professionals?

We have a mix of students, medical professionals, young professionals and empty-nesters. Our residents have a busy, August 2015 25

Industry Influencer In future, Pirie says community living spaces, such as libraries, theatre rooms, and party rooms, will be important because they enhance a resident’s living space as units become smaller.

‘on-the-go’ lifestyle and enjoy living in the heart of the city. They like being minutes away from all that the city has to offer and can get around on bike, transit or foot.

What green features can residents find at your properties that they can’t find elsewhere?

The fact that we have done away with the traditional garbage chute at our last two new multi-res rental properties makes us unique on the ‘green’ front. We were awarded LEED gold at both Motion and One32, located at 132 Berkeley Street. Additionally, we target a minimum, Tier 2 Toronto Green Building Standards on all new builds. We include green roofs and water retention systems to reduce heat loss and energy costs, and we sub-meter all utilities within each suite. We are continually challenging our operations team and building residents to “Reduce, Reuse and Recycle” and we just had all of our multi-family properties certified as members of FRPO’s “Living Green Together” program. Also, Concert has a national agreement with ZipCar in which we provide our residents with a discounted membership upon move-in. We have dedicated electronic car charging stalls available in our last four constructed buildings.

26 www.canadianapartmentmagazine.ca

Where do you see purpose-built rental going? Specifically, what features do you think will be important in the future?

A master-planned community that provides opportunities for residents to mix and socialize is going to be the future of apartment living. Interactive community programming that gives updates about activities within the rental community and the surrounding area. The focus needs to be on community-building, which results in longer term residents. Amenities should include spaces for private meetings and studying now that more and more people are working from home. Community living spaces, such as libraries, theatre rooms, and party rooms, will be important because they enhance a resident’s living space as units become smaller.

If you were renting an apartment in the city, what would be your top three needs?

1. Superior customer service and professional property management.

2. Finding value in the unit and building amenities.

3. Location, location, location – close to transportation, shopping and entertainment.

Industry Influencer About Motion • 2014 FRPO MAC AWARD NOMINEE for Rental Development of the Year • 29-storey rental high-rise • 463 units • 10,664 square feet of ground floor retail space • LEED Gold • Completed in the spring of 2013 • Offers studio, one, two and two + den bedroom rental apartments.

Average price: $1,830.

• The development is located in downtown Toronto, steps from the financial district, shopping, the University of Toronto and Ryerson University

Sustainable features: Motion is one of the first rental residential buildings to achieve the Tier 2 Toronto Green Standard certification. Some of its sustainable features include: • Designated bicycle storage areas for 471 bicycles • A high Walkscore.com rate, which describes the site as a walker’s and transit rider’s paradise • Extensive green roofs for reduced storm water runoff, improved CO2 emissions, reduced urban heat island effect • 100% of the landscaping is irrigated using harvested rainwater collected and stored in a cistern tank • Specially designed showerheads and faucets use much less water than standard fixtures, and toilets are high efficiency • Every suite is equipped with a heat recovery ventilator that improves ventilation, air quality and living comfort by delivering fresh, filtered outdoor air • Every suite is equipped with compact fluorescent lights, five ENERGY STAR appliances, and programmable thermostats • Motion provides low-level exterior lighting, fixture shields and dark-sky friendly signage to minimize the light spilling from the property

August 2015 27

Portfolio

Aiming For Above Average Once an Apartment is Built, Only Amenities Can help you Get those Higher than Average Rents

By Derek Lobo

Apartment rents are driven by three factors: the apartment’s location, the apartment’s layout and design, and the amenities the apartment has to offer.

For more tips and insights, visit

28 www.canadianapartmentmagazine.ca

Of these factors, once an apartment is built, landlords only have control over the building’s amenities. It’s hard to change an apartment’s design once it is set in wood, plaster, and concrete, and you certainly can’t change your building’s location. Above average amenities will guarantee you above average rents, compared to other apartments sharing a similar location or design.

Fortunately, amenities are something that potential tenants look for in rental apartments, moreso than prospective condominium owners do. More often

than not, the potential condo owner is looking for an investment that will grow over the long term. Potential apartment renters are looking for a place to live. I like to say that while the condominium buyer is buying the steak, the apartment renter is looking for the sizzle.

What does this mean for landlords looking to attract tenants? It means that rental property developers and owners need to consider the arrival experience for potential tenants looking to rent in their buildings, rather than the size and design of their apartments.

Portfolio A condominium developer looking to sell an 800 square foot condominium for $250,000 can add another $5,000 to that price if they can add an additional 10 square feet to the unit. The additional space makes no difference to a renter.

On the other hand, an excellent entrance and common facilities will mean that renters will be happy to pay higher rents for smaller units.

That’s good news for owners of purpose-built rental apartments, since more and more tenants these days are young millennials. Micro apartments are taking an increasing percentage of the marketplace in cities like Toronto, New York and Vancouver, where the smaller square footage can mean more affordable rents for tenants. Landlords will see a greater benefit if they are able to offer amenities that cater to this generation. If young renters cannot find good restaurants, shops, services and fun places to be, landlords can attract these renters by providing enticing amenities within the building.

AnotherTakeCover_CAM_August_2013_FINAL.pdf good thing about amenities is that the cost is increasingly amortized

the larger the building that includes appreciate. Fitness centres are similarly them. A swimming pool is far more useful, though the types of classes one affordable in a 100-unit apartment than offers may differ depending on the it is in a 10-unit apartment. An investor average age of the building’s tenants.

It is helpful to look at the hotel industry might consider purchasing multiple buildings in an area and then adding in considering how to build up your a single amenity to be used by all the building’s amenities. Our increasingly buildings’ tenants to get the best use affluent tenants are looking for comfort of their investment. Such consolidations and service, which the hotels have also helps to lower overall expenses, become experts in supplying.

With more and more new apartment improving your bottom line.

You do need to be aware of the construction happening in Canadian different preferences that different cities, older properties are feeling the demographics have. Gone are the days pressure as new stock comes on the when young professionals or couples and market with a significant competitive senior citizens shared the same building. advantage. However, owners and The millennials are increasingly affluent investors of older buildings can maintain and are demanding different styles and even increase their rents without of apartments and amenities. Elderly major renovations to their units if they tenants want more space, and are less take the time to invest in amenities that interested in things like in-lobby coffee cater to their tenants’ needs. shops. Buildings that offer activities for visiting grandchildren are obviously more interesting to mature renters than Derek Lobo is the CEO of Rock Advisors Inc., to young and single urban professionals. Brokerage, an Ontario-based commercial real However, some amenities are estate company that focuses on the apartment Davroc_Condo_March_2014_FINAL.pdf 1 14-03-18 10:14 AM 1 13-07-22 PM important to2:54 everybody.

Pet facilities sector. For more information call 905-331-5700 are something young and old tenants or email him at dlobo@rockadvisors.ca.

August 2015 29

Management

Amenities for All in 2015 Keeping Your Property On Top of the Latest Trends

By Jessica Green

From easy-to-implement to downright decadent, 2015 has been an interesting year for amenities thus far. According to a report from For Rent, 84 percent of renters say that having a fitness centre on site tops their amenity wish list. You probably expected that. Perhaps less expectedly, 78 percent of renters said they wanted to have a secure place for packages and parcels to be dropped off and stored. Is this something that you could commit to adding as a feature in your building? It would certainly make you stand out. Here’s what else is hot this year in amenities.

Pet-friendly zones People love their dogs. In fact, according to the 2014 Canadian Pet Market Outlook, Canada is home to roughly 5.9 million dogs.

And that number only continues to rise annually. The takeaway here is that a building that accommodates dog owners will attract this steadily growing market of pooch lovers.

So how do you retain them? Take Toronto apartment building 88 Erskine Ave., for example.

Apartment marketing specialist Sheryl Erenberg explains, “This property has hosted 30 www.canadianapartmentmagazine.ca

multiple Pooch Parties, which cater to pets and their owners. We’ve also promoted pet portraits done by local artists. The property’s website features a Pet of the Month and the site also offers Pet First Aid courses and pet waste stations. Residents love the attention and the fact that the building loves their pets as much as they do.”

A hotel-style lobby As newer generations start moving into apartment buildings, the traditional lobby of old is slowly going out of style. Millennials

are looking for a communal feel, topped with a concierge, large seating areas and even snacks. Yes, you read that correctly: snacks.

While many apartment buildings will have resident appreciation events once in a while that feature treats and drinks, the newest generation of renter is looking for a property that does it on the regular.

“Gen Y and even Gen X renters love the idea of a boutique-style apartment building that they can call home, and that includes little finger foods and snacks that they can grab on their way out the door,” says Lorelei Holden, a

Management

Senior Property Manager at Greenwin Inc., who hosts regular events, including breakfasts and after-work parties in the lobbies of her properties. “It could be something as simple as muffins and water bottles or as elaborate as wine and cheese. Either way, having that presence is very appealing. It adds a touch of community and togetherness.”

Artful additions At 30 Carabob Ct., property owner David Binder, who is also the architect behind the property’s restoration, commissioned Toronto-based artist Harley Valentine to create a unique kind of amenity: permanent sculptures that now grace the lawn of the property.

“Harley Valentine is renowned for his colourful and creative pieces,” explains Binder, President of Rosebind Developments Ltd. “We wanted to bring a little of that artistic energy home for our residents and to enhance the resident/ pedestrian experience of the newly restored and reconfigured site. Each piece tells a story and now our building tells a story, too.”

Indeed, seeing beautiful art installations like the 30 Carabob Quartet, as the piece has been dubbed by Valentine, is a rarity in the rental space.

Commissioning sculptures, particularly ones created by local talents with global reach, instantly enlivens a property in a truly innovative way. The sculptures at 30 Carabob Ct. have already generated a buzz throughout the neighbourhood, with many non-residents stopping by to view them.

“The art is so unique to the area—it really has people talking,” says Binder.

“We’re proud that they are here for our residents to call part of their home.”

Going green You’ve heard it in previous years, and you’ll hear it again in years to come—being a green building is the way of the future. More and more renters want to live in a property that cares about the environment and makes green living a priority.

The Certified Rental Building (CRB) program has found that a growing number August 2015 31

Management

of landlords recognize the need to capture a “hidden human” level of savings, which means involving and educating frontline staff and residents on active conservation programs.

“Many property management firms are creating departments or committees that are primarily responsible for designing, developing and implementing corporate environmental policies,” Ted Whitehead, CRB’s Director of Certification, explains. Thinking outside the box, landlords are implementing and marketing creative green amenities like charging stations for electric vehicles, AutoShare stalls, rooftop community gardens and enhanced recycling programs.

Up high When it comes to your roof, the sky’s the limit. If you own a high-rise building, the time to invest in transforming your roof is now. From BBQs to wood-burning pizza ovens, the modern, sophisticated renter enjoys spending time in a space that can be both community-building and secluded.

“For an ideal rooftop terrace, focus on creating a space that promotes relaxation and social activities for renters by including items like a BBQ, lounge chairs and an outdoor TV,” says Jason Green, a Project Coordinator with Verdiroc Development Corporation. “Some properties are even adding sunken hot tubs or expansive spaces for yoga.”

Along with hotel-style terraces and BBQ areas—which are quickly becoming the norm— apartment renters are upping the ante, asking for higher-end amenities like simulated golf, rock-climbing walls and rooftop exercise facilities.

Appealing to parents Finally, more and more young families are deciding to rent rather than buy. This type

of renter wants amenities that benefit their children, including secure building access as well as organized activities.

“Many renters that have kids also work during the day, and if they can find an apartment building that has childcare, they would sign a lease immediately,” says Marshall Bleiweis, President, Sterling Karamar Property Management. “Even better would be having on-site daycare or after-school activities. Larger suites to accommodate a growing family are also highly desirable. If you renovate your suites appropriately, you’ll get families in them.”

From large to small, amenities are always evolving. Determine how you can help to better serve your residents by working to make your apartment building the best it can be. Unsure of where to start? Take a poll of your residents to find out what they want most and start working to implement the changes over time.

Jessica Green is the founder of Cursive, a Toronto-based communications consulting firm that specializes in brand messaging with an emphasis on digital media strategy.

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Insurance

Let’s Talk “Cyber” Safety Money-related Fraud Happens to the Best of us— Are you Covered if it Happens to You?

By Andy Schwartze

For more insurance tips, visit

34 www.canadianapartmentmagazine.ca

Approximately 15 years ago, a young teenager by the name of Michael Calce hacked his way into the websites of Amazon and Yahoo. This caused great concern to the business sector, while also fuelling the imaginations of young electronic criminals everywhere.

Calce has since moved on to become a cyber-consultant to big corporate interests, like JPMorgan Chase—a company which has also been the target of a serious cyber breach intrusion.

Insurance

You might be thinking, “Cyber crooks only go after big fish so I don’t need to worry about it,” but let me recount a few stories that will make you think again.

In early April, my wife and I were having dinner in San Francisco. She was livid because she’d just discovered her credit card had been declined even though she’d deliberately paid her balance off before we’d embarked on the trip. After consulting with Visa, it turns out their internal security gates had gone up and blocked her card. An intruder had managed to charge her card with about $2,000 in unauthorized purchases, all of them had a Microsoft tag and not one charge was over $10. The charges had been posted to her credit card in intervals of one second. She was stunned, as was I. It was the second time such a breach had happened to her.

Since then, I have twice used the well-known web site Kijiji in order to sell off a few items. On both occasions, I experienced the same attempted fraud.

An unnamed individual would text me from a 1-800 number, asking if the item was still for sale and if the price could be negotiated. In both cases, the inquiry came within 12 hours of my posting on Kijiji, and on answering via text, I would explain that the item was available and that the price was firm.

In both cases, the responses I then received requested that I forward my PayPal account information so that payment could be made using that intermediary system. Fortunately, I had

enough sense to question why someone would be so quick to buy an item worth well over $1,000 without any further due diligence. My next move was to ask for some identification. The explanation I received back in both cases was bogus—a fake name, a fake address, and some sordid story about being on a work assignment with no access to a phone.

Having become very suspicious I cut the communication. The reality is that, no matter what kind of intermediate payment system is used, the money travels down an electronic corridor.

It does not cross the street or go from one unconnected pocket to another.

The electronic signals that represent the payment remain connected from one end to the other; and that means an outsider with sufficient skill can track that corridor and steal from you.

I had a client recently receive an email from the company owner requesting the transfer of a meaningful sum of money to the owner’s account electronically.

The owner’s e-mail account had been hacked and the company manager had no reason to believe the request was bogus. Following the wire transfer it was discovered that the owner had never made the request in the first place, and—you guessed it—the money was gone. It took a significant effort to convince the bank that a crime had been committed, but before the day was over, the money had been recovered. Had a couple of days gone by, it would have

been too late. The bank, in this case, correctly took the position that it had not made any mistake in handling the client account and was, therefore, not responsible for someone having wired money to the wrong destination. The bank’s position was patently solid; my guess is the threat of losing the client’s account may have had some impact.

Without going into a lot of technical insurance talk, when it comes to cybercrime, we all need to understand that there is insurance available for money related frauds. The tricky part, for the insurer, is attempting to determine whether or not an electronic theft is a true intrusion from an outside attempt to steal, or whether the claim is driven by an insured’s desperate attempt to make a fraudulent claim.

This type of claim is tough to deal with at the best of times, so the insurance underwriting community has been very slow to react to these new “cyber realities.” The tracing of what has happened is extremely difficult, generally crosses international borders in to countries few of us would gladly visit, involves larger sums of money— and “intent” to defraud is very hard to prove. But, in spite of this, there are specific insurance contracts available to protect companies who become victims of cyber-crime. For those who operate businesses with multiple accounts and limited oversight, it’s a topic well worth broaching with your advisor.

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August 2015 35

1

Marketing

Lobbying for Lobbies Transform the Entrance of Your Property and Watch it Pay off

By Chaim Rivlin

As any property manager will tell you, once a potential resident is enticed into viewing a property, it’s the lobby that will make the first impression. For that reason, having a beautiful, well-appointed lobby is important—but also, it’s a space current residents should enjoy and feel proud of.

Richard Grossman, Director of Halstead Property in the Tri-State area, once said in New York Magazine: “If a building is putting $5,000 [per resident] in upgrades, you’ll see a $50,000 increase in value [per apartment].”

Knowing when to renovate There are a number of signs that will help you to decide when it’s the right time to begin the renovation process of your lobby. Along with, dare we say it, tacky furniture that no one wants 36 www.canadianapartmentmagazine.ca

to sit on, take some time to decide how you feel when you’re in the lobby. Is it not very well lit? Is there junk mail stacked in corners? Are the plants looking like they’ve seen better days? How is the paint holding up?

For Lorelei Holden at Greenwin Inc.’s 1130 Wilson property in Toronto, the renovation push came from an aging elevator system.

“The top request from our residents was to have an upgraded elevator, and we knew that the initial output of cost would be worth it in

Marketing

both attracting new tenants and retaining our long-term residents,” says Holden. “In many ways, the elevator indicates the overall health of your building. I kind of look at it as the heart of the property. It was important to us to ensure that it was updated and modern.”

local artists. It’s a unique way to help support our community,” says Jessica Green, Director of Communications at Greenwin. “Not only does the art make a statement; residents are thrilled to see pieces that they know are from a talented artist in their own city.”

Of course, what one person finds artistic another person might find boring, so rotating art every so often is important. Form a partnership with a local gallery or artist and treat your lobby like your own art gallery. Get suggestions from your residents about the type of art they would like to see to keep it fresh and interesting.

Wall neglect For older properties, the state of the walls in the lobby can give away the age of your building. If the paint is faded, chipping or yellowing, it’s time to invest in a completely new paint job. “Put yourself in the shoes of someone coming to view your property for the first time,” says Sheryl Erenberg of Sheryl Erenberg & Associates. “If you see a dark, unkempt lobby that has clearly not been cared for, would you want to live there? You’d have to walk through that lobby every single day. It really speaks volumes without saying a word.”

When it comes to choosing a paint colour, remember to keep it bright. White is of course a classic option, but also consider beige or cream. “Not only will having neutral colours be easier to take care of and maintain, but they provide an ideal backdrop for any art that you wish to hang up on the walls,” says Erenberg.

Competing with condos Older buildings that were constructed in the 1960s and 1970s are now struggling to compete with the burgeoning condominium market. One way to stay ahead of the game is to give your lobby that condo-quality look. Where once there was carpeting, add in travertine tiles that are both beautiful to look at and far easier to take care of. Older, leaky windows that are clearly weathered can be replaced with bright, shiny new panes that let the sun really shine in.

“Millennials in particular want a condo-style look, but are finding they simply can’t afford the sky high price tag that comes with it,” says Green. “By making these lobby upgrades, we are able to give the modern renter what they want at a price that’s affordable.”

About art Many property managers are opting to install art in their lobbies to add some sophistication and aesthetic appeal.

But don’t go for just any old art that you can find on sale—more and more properties are going the local route and commissioning pieces directly from artists in their community.

“When we start the process of choosing paintings for a lobby, we try to find works by

The details make the difference Making major overhauls are ideal, but the devil is in the details. After all, what good is a shiny new paint job if the plants in the lobby are dying? Take the time to maintain the lobby plants and invest in new, heartier ones that help with keeping the air clean. Keep the mail room, often an extension of the lobby itself, clear of piles and piles of junk mail. Vacuum any carpeting or rugs daily. Wash the interior and exterior of the lobby windows regularly, or hire a window washing company for that extra shine.

Some properties are even opting for adding in that extra layer of security once their lobby has been renovated—a concierge. These important employees give a building a feeling of increased safety for tenants and help to ensure things are running smoothly. “A concierge can help to address issues that come up immediately, such as dealing with package deliveries and tenants that need to move in a new piece of furniture,” says Erenberg. “They also act as a deterrent to property crime and add to the overall feeling of community in a building.”

If you want to get a leg up on the competition, renovating your lobby is the place to start.

From elevator overhauls to art, your lobby is the lifeblood of your property and needs to be treated as such. Give your tenants— and potential tenants—a lobby they can be proud to walk through each and every day.

RentSeeker.ca is Canada’s Leading Online Apartment Finder and Real Estate Marketing Company, offering Landlords a full suite of marketing services.

August 2015 37

Smart Ideas

What’s New in the Laundry Room In-suite laundry facilities sit high on the amenities must-have list. But when it comes to the machines themselves, it’s all about energy efficiency and noise reduction.

Energy-efficient machines Whirlpool has a long history in environmental stewardship including helping to draft the first ENERGY STAR appliance standards. ENERGY STAR continues to be an important part of Whirlpool’s broad-based sustainability strategy including efforts that reduced the company’s absolute GHG emissions by 6.6% from 2003 to 2012.

“Building water- and energy-efficient products lets our consumers save money and make a significant contribution to protecting the environment—all without sacrificing performance or innovation,” said Gary Power, vice president and general manager for Whirlpool Canada. “We are proud to be recognized with the Manufacturer of the Year award again this year.”

The award recognizes achievements that advance market transformation related to energy efficiency. Whirlpool Canada has received an impressive twelve ENERGY STAR Recognition Awards, including nine as Manufacturer of the Year, one as Participant of the Year, and two for Sustained Excellence.

Front load washers Noise complaints are common in multi-residential buildings. Speed Queen’s new front load washer addresses this problem with a redesigned suspension and advanced sensing logic to deliver smoother cycles resulting in less vibration and noise.

“Apartment, condo, and dormitory residents often complain about machine noise that carries into their units,” Speed Queen Multi-Housing North American Sales Manager Craig Madson said. “This issue was a key consideration while developing the new front load washer, which reduces noise by limiting vibration while providing superior wash quality.”

The new front load washer equalizes out-of-balance loads to deliver consistent and smooth wash cycles. This design also causes a reduction in machine vibration to deliver 2.5 times less noise than previous models, minimizing sound effects on units.

38 www.canadianapartmentmagazine.ca

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