CAM July-August 2019

Apartment CANADIAN

VOLUME 16 / NUMBER 3 / JULY/AUGUST 2019

WHAT RENTERS WANT SERVICES & AMENITIES THAT MATTER plus

PA R T O F T H E

MARKET HIGHLIGHTS

ELECTRICAL

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EDITOR’S NOTE>>

Apartment CANADIAN

COMFORT & CONVENIENCE

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Services and amenities offered at apartment buildings have changed a lot over the past few decades. But some things never change—and that’s the human desire for comfort and convenience.

Still, not too long ago, a yoga studio or a dog park at a rental building was unheard of. Today, upscale condos and hotels have nothing on luxury apartment buildings. Whether it’s an on-site coffee shop, fitness centre or a movie theatre, most modern rental properties are striving to keep residents happy, fit, fed, and connected.

In our cover story, we go behind the scenes at an impressive new apartment tower in downtown Toronto, called The Selby. Catering primarily to a millennial tenant base, property owner Tricon House takes us through some of the unique amenities and features of the building, which opened in November of 2018. With several new properties in development for the downtown core, Tricon House is already making a name for itself in the luxury rental living space.

Find out what’s driving the company into new territory on page 16.

Also in this issue: updates to the electrical safety code that are affecting landlords and property owners; tips for sprucing up outdoor spaces; market trends and transactions; rising insurance claims; and more. With summer winding down and the fall nearly upon us, we hope you’re feeling well rested and ready for another busy rental season. Thanks for being a devoted reader of Canadian Apartment.

Sincerely, Erin Ruddy

rent trends

@CdnAptEditor

Publisher

Dan Christie

Editor

Erin Ruddy

Senior Designer

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Rachel Selbie

Contributing Writers

Graeme Huycke Andy Schwartze Dr. Joel Moody

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Kelly Nicholls Melissa Valentini

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Apartment CANADIAN

VOLUME 16 / NUMBER 3 / JULY/AUGUST 2019

FEATURE 14 K EEPING UP WITH ONTARIO’S ELECTRICAL CODE An apartment owner’s guide to recent ammendments

by Dr. Joel Moody

COLUMNS 8 Transactions Rental Demand Remains High Across Canada 10 CMHC Multi-unit Housing Construction

by Graeme Huycke 24 Ask the Expert Breathing Life into Outdoor Spaces 26 Newsworthy Industry Hot Topics 30 Insurance Rising Water, Rising Claims

by Andy Schwartze

COVER STORY

DEPARTMENTS

16 Redefining Rental Living The Selby’s unique millennial-centric amenities and design

by Erin Ruddy

4

Apartment CANADIAN

ON THE COVER:

VOLUME 16 / NUMBER 3 / JULY/AUGUST 2019

The Selby, image courtesy of Tricon House

Editor’s Note WHAT RENTERS WANT SERVICES & AMENITIES THAT MATTER

32 Smart Ideas

plus

PA R T O F T H E

PA R T O F T H E

MARKET HIGHLIGHTS

ELECTRICAL

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Rental Demand Remains High Across Canada Market observations from Morguard’s Keith Reading As the mature phase of Canada’s multi-suite residential rental sector cycle unfolds, we are seeing a period punctuated by stable and positive market fundamentals.

Rental demand continues to outpace supply, resulting in a measure of imbalance. Population growth, the inflated cost of ownership, rising youth employment and the aging of Canada’s population have boosted rental demand.

“In most regions of the nation, tenants have struggled to source availability when looking to secure higher quality premises or when looking to relocate,” says Morguard’s Director of Research, Keith Reading. “Vacancy levels rested at the cycle-low in the country’s

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City

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1.

17925 Versailles Blvd

Montreal

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Skyline Apartment REIT

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The Point Apartments

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$39.0

$397,959

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Montreal

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8 | Canadian Apartment | Part of the REMI Network |

TRANSACTIONS >>

Average Monthly Rents Continue to Trend Upward Findings from the Rentals.ca June National Rent Report

T

larger urban centres in 2018 and early 2019, which in combination with strong demand, pushed rents to the cycle-high.”

The exception to this rule was in Alberta, where vacancy levels remained well above the national average. The upward rental rate trend of the recent past and overall rental market tightness supported increased construction activity. In Toronto, for example, construction completions surged to a 25-year high of 1,849 units in the first quarter of 2019, according to Urbanation. Construction completion activity was expected to rise through the balance of the year. The overall health of the national multi-suite residential rental market of the recent past was supportive of continued investment market advancement.

Investment market characteristics of the past year were in keeping with the mature phase of the cycle.

Transaction volume peaked, resulting in a record annual sales volume high of $8.3 billion (CAN) in 2018.

This was followed by a further $1.4 billion in the first three months of 2019. Investors looked to increase their holdings in a sector that offered downside protection in an economic downturn and strong performance patterns over the past several years.

“The demand pressure supported property values that hovered at the peak for the cycle, with modest increases also observed,” says Reading. “At the same time, cap rates rested at the cycle-low, although the era of compression appeared to have largely ebbed.”

Stabilized assets in the countr y’s largest urban centres have been popular with investors.

Competition has been intense, given limited availabilit y. Access to low-cost capital and a healthy fundamental sec tor outlook suppor ted healthy investment ac tivit y across the nation, during the continued mature phase of the c ycle.

he average monthly rents in Canada increased another 1.9 per cent in June after going up 4 per cent in May, according to a recent National Rent Report produced by Rentals.ca and Bullpen Research & Consulting.

“Rental rates continue to trend upward in Canada as the economy remains stable and growing, further boosting demand, while the supply being added to the market is well above the existing average rent levels,” said Matt Danison, CEO of Rentals.ca.

While June is a prime month for rental listings and demand, the average rental rate for all property types was $1,953 per month and the median asking rent of $1,875 was up from $1,800 in May. But the average rental rate for only apartments declined slightly month-over-month from $1,531 in May to $1,526 in June.

Toronto continues to lead all cities in average monthly rent for one-bedroom homes at $2,266, but Vancouver again took the lead away from Toronto for average monthly rent for a two-bedroom at $2,833. ($2,782 in Toronto).

Gatineau, ($825 and $1,101), Quebec City ($843 and $1,074) and Lethbridge ($925 and $1,074) continue to take the lowest spots on the monthly rental list for both one- and two-bedroom homes respectively.

On a quarterly basis, median rental rates for most major municipalities in Canada were the same or higher, except in Ottawa, Edmonton and Red Deer.

Toronto and Mississauga lead the list for most expensive median rents in the second quarter for the cities listed.

On a provincial level, Ontario led the way for average monthly rent for apartments only in the second quarter at $1,830 — that’s almost $300 more per month than British Columbia. (The premium in Ontario over British Columbia is smaller for one-bedroom and two-bedroom units at around $250 per month.)

Average monthly rents for all property types have steadily increased in Ontario from October 2018 to June to $2,279, again making the province the priciest for those listed.

Average and Median Rent by Quarter, Rentals.ca Listings for All Property Types in Canada, Q4-2018 to Q2-2019 2018 Q4

$2,000

2019

Q1

$1,950

Avg. Rent

$1,900

Median Rent

Q2

$1,910 $1,870

$1,850 $1,800

$1,800

$1,794 $1,765

$1,750 $1700 0 $1,650

$1,650 $1,600 $1,550 $1,500 Avg. Rent

Median Rent

Avg. Rent

Median Rent

Avg. Rent

Median Rent

| www.REMInetwork.com | July/August 2019 | 9

CMHC REPORT >>

Multi-unit Housing Construction Apartment starts contribute to higher national average The trend in housing starts was 208,970 units in July 2019, compared to 205,765 units in June 2019, according to Canada Mortgage and Housing Corporation (CMHC). This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.

“The national trend in housing starts increased in July, despite a decrease in the level of SAAR activity from June,” said Bob Dugan, CMHC’s chief economist. “High levels of activity in apartment and row starts in urban centres in recent months continued to be reflected in the high level of the total starts trend in July.”

Vancouver Vancouver Census Metropolitan Area (CMA) housing starts continued to trend higher in July. Compared to the same period last year, the year-to-date single-detached home starts declined while the multi-unit starts increased. More than 85 per cent of starts were multi-unit, most of which are in the City of Vancouver and the City of Surrey. Overall, continuous strengthening of economic fundamentals supported a steady growth of 25 per cent in the year-to-date starts in the CMA between 2018 and 2019.

10 | Canadian Apartment | Part of the REMI Network |

The standalone monthly SAAR of housing starts for all areas in Canada was 222,013 units in July, down 9.6 per cent from 245,455 units in June. The SAAR of urban starts decreased by 10.4 per cent in July to 209,122 units. Multiple urban starts decreased by 12 per cent to 162,722 units in July while single-detached urban starts decreased by 4.6 per cent to 46,400 units.

Victoria Housing starts in the Victoria CMA declined in July, relative to the same month last year, across both the single-detached and multiunit segments of the market. In the first seven months of 2019, housing starts were down approximately 12 per cent relative to the same period in 2018. Continued overall strength in housing starts in the Victoria area is symptomatic of strong housing demand seen over the past three years and current strong demand for multi-unit options, in particular, in the area.

Lethbridge The trend in total starts in the Lethbridge CMA was higher in July 2019 compared to the previous month. Apartment starts trended 360 per cent higher compared to June as rental demand continue to increase. Singledetached and row starts trended lower while semi-detached starts remained stable.

Regina Total housing starts in Regina trended lower in July after the pace of single-detached and multi-family construction slowed from

the previous month. In 2019, builders have initiated just over a third of the total units started over the same period in 2018. This is largely due to higher construction costs and weaker economic conditions that have moderated new home demand and caused some projects to either be shelved or cancelled altogether.

Winnipeg The trend in total housing starts in the Winnipeg CMA decreased in July compared to the previous month. The downward trend in total starts was mainly due to decreases in multi-family starts as both row and apartment starts trended lower. Single-family starts, however, trended higher but were not enough to offset the decreases in the multi-family units.

Toronto Total housing starts trended lower in July in the Toronto CMA, primarily driven by lower multi-unit starts (semi-detached,

rows, and apartments). Pre-construction sales of multi-unit homes, particularly condominium apartments, have been strong for the last few years and will break ground at a varying pace throughout the year. Strong demand for relatively affordable higher density housing continues to persist among homebuyers in Toronto.

Year-to-date, total housing starts sit 5.3 per cent higher than the same period last year with the strongest growth in condominium apartments followed by row starts. Low resale and rental market supply coupled with higher ownership costs for single-detached homes are encouraging construction of less expensive dwelling types.

St. Catharines In July 2019, the total housing starts trend in the St. Catharines CMA inched lower.

The total housing starts trend in recent months remained close to a 30-year high with townhomes accounting for the largest share. Improvements in employment conditions for people aged 25-44 fueled first-time home buying activity in relatively affordable home types such as townhomes.

MontrĂŠal From January to July, housing starts in the MontrĂŠal area were up compared to the same period last year. This gain was solely attributable to rental housing construction, as condominium and single-family home starts recorded decreases. The low vacancy rates on the conventional rental market and the greater proportion of young households now opting for rental housing have kept stimulating rental housing starts.

Seniors’ rental apartment construction has also posted strong growth since the beginning of the year.

Ottawa The monthly trend for housing starts grew in Ottawa in July across all housing types.

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| www.REMInetwork.com | July/August 2019 | 11

CMHC REPORT >>

“Total housing starts in PEI were 319 per cent higher in July, due to the ongoing surge in new apartment construction activity in response to the Island’s near zero vacancy rate.”

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Saguenay From January to July, housing starts in the Saguenay CMA dropped by 18 per cent compared to the same period last year. This decrease in activity was attributable to fewer homeowner (freehold and condominium) housing starts. Overall, residential construction in the area has been limited by the slowdown in employment and low population growth.

New Brunswick In New Brunswick, year-to-date total housing starts are up 40 per cent compared to last year.

The increase largely reflects unprecedented levels of rental apartment construction, particularly in Moncton and Saint John. These two CMAs alone accounted for 75 per cent of all new multi-unit construction in the province.

The number of multi-unit starts this year are the highest recorded in the first seven months since 2010. New Brunswick’s urban centres are benefiting from provincial strategies to actively attract and retain immigrants. These new arrivals are boosting rental demand, in addition to demand from an aging population.

Prince Edward Island (PEI) Total housing starts in PEI were 319 per cent higher in July, due to the ongoing surge in new apartment construction activity in response to the Island’s near zero vacancy rate. The PEI economy continues to outperform the other Atlantic Provinces, driven primarily by increased capital project spending and growth in population, income and employment.

CMHC uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and obtain a more complete picture of Canada’s housing market. In some situations, analyzing only SAAR data can be misleading, as they are largely driven by the multi-unit segment of the market which can vary significantly from one month to the next.

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FEATURE >>

Keeping Up With Ontario’s Electrical Safety Code An apartment owner’s guide to recent amendments

by Dr. Joel Moody

Each year, thousands of innovations are released into the Canadian market. These can range from slight improvements to existing products to revolutionary new technologies that fundamentally change the way we do things. No matter how big or small the innovation, it is critically important that there are regulations in place that account for change and keep people safe.

I

n Ontario, the Electrical Safety Authority (ESA) is mandated by the government as the authority responsible for electrical safety throughout the province. As a modern regulator, we want to ensure that we do our job effectively without hampering that drive to innovation that makes 14 | Canadian Apartment | Part of the REMI Network |

Ontario a great place to do business.

One of the primary mechanisms by which the ESA keeps Ontarians safe from electrical harm is by regularly updating the Ontario Electrical Safety Code (Code). By following the standards set out in the Code, Ontarians reduce their risk of electrical injury.

On M a y 16 , O n t a r i o’s n e w C o d e took ef fec t and there are some changes that building owners a n d m a n a g e r s s h o u l d k n o w. T h e O n t a r i o C o d e a d o p t s , b y r e f e r e n c e, t h e C a n a d i a n E l e c t r i c a l C o d e, and adds on top of that Ontariospecific amendments.

FEATURE >>

Among the changes that could affect building owners and property managers are the following: • Requirements for installing an identified (neutral) conductor at each control (switch) location of permanently installed luminaire; • Alignment with the Ontario Building Code to prevent the installation of high-voltage conductors over buildings; • Providing of adequate working space for electrical workers to undertake necessary repairs, maintenance and installation of transformers greater than 50kVA; • Prohibiting of installation of cables in concealed locations in corrugated roof decking • Adding requirements for Energy Storage systems; and • Facilitating the use of Power over Ethernet to provide a pathway for sources of electricity.

All electrical work must align with the Ontario Electrical Safety Code Property owners are required to regularly maintain and repair electrical systems to ensure they are in safe working order. That means that as they conduct repairs and ongoing maintenance to the electrical systems within their building, it’s important to ensure that they’re operating according to the most up-todate standards available—that means that all electrical work must be done in accordance with the most recent version of the Code.

Unfortunately, that doesn’t always happen. A survey 1 of property managers in Ontario conducted in 2015 indicated that close to 35 per cent didn’t realize the Code applies to electrical work in their buildings. But it does. In fact, the Code must be followed for ¬all electrical work – maintenance, repair and new projects.

The best way to ensure that work is up to code is to work with a Licensed Electrical Contractor (LEC). LECs are familiar with the Code and they’ll ensure that the necessary notifications (also referred to as permits) are obtained to facilitate review of the electrical work by inspectors from the ESA.

The best way to ensure that work is up to code is to work with a Licensed Electrical Contractor (LEC).

The dangers of unlicensed work For building owners and managers who don’t do their due diligence, the implications can be catastrophic. First, by working outside the safety system, you put tenants at risk. According to the Office of the Fire Marshall and Emergency Management 2 , between 2012 and 2016, there were an average of 23 fire injuries per year caused by electrical wiring—working to Code ensures that your electrical system is as safe as possible.

Next, fixing bad work can be far more expensive than doing it right the first time. If an inspector comes across work that’s not up to Code, they can shut off the connection to the grid if the risk is high enough. To get the building back up to Code as soon as possible, you may need to do emergency rush work, which costs a significant premium.

Aging infrastructure a growing problem As a modern regulator, ESA is committed to identifying potential threats and mitigating risk quickly as issues emerge.

We’ve identified aging infrastructure as one such emerging issue.

When new innovations are introduced, buildings don’t simply throw away what existed before. There are millions of buildings and houses across Canada operating with old electrical systems

that haven’t necessarily been upgraded to meet modern safety standards. This is especially true of large multi-residential buildings.

According to the Canada Mortgage and Housing Corporation (CMHC) 3 , three quarters of the country’s primary rental stock was built before 1980, with 25 per cent built before 1960. This means that the majority of rental properties built in Canada are at least 40 years old, with many of those buildings much older than that. In Ontario, 85 per cent of purpose-built rental units are more than 35 years old .

Property owner or managers can be proactive in maintaining their building’s electrical system by working with an LEC to create a preventative maintenance plan. An LEC partner should be selected based on their experience working with buildings of similar type, age and with similar equipment. Their plan would include scheduling inspections regularly to ensure that issues are addressed, and their systems are up-to-date.

At the end of the day, we all want to be safe in our homes and at work.

By following the updated Code and working with trained professionals, you’re doing your part to keep people safe while also limiting your own liability.

It’s a win-win for all of us.

1. Electrical Safety Authority survey of Property Managers in Ontario from November 30 to December 14, 2015.

2. The Office of the Fire Marshall and Emergency Management, Ontario Residential Fires: Injuries 2012 to 2016.

3. CMHC, A Profile of Purpose-Built Rental Housing in Canada, April 2016.

4. Federation of Rental-housing Providers of Ontario; Ontario Rental Market Study: Measuring the Supply Gap, September 2017.

Dr. Joel Moody (MD, PhD, MPH) is Director of Safety, Risk, Policy and Innovation with the Electrical Safety Authority (ESA). | www.REMInetwork.com | July/August 2019 | 15

REDEFINING RENTAL LIVING The Selby’s unique millennialcentric amenities and design

COVER STORY >>

By Erin Ruddy

By definition, amenities in the real estate sphere are elements of comfort and convenience—those tangible building features considered to benefit a property and thereby increase its overall value. Examples of common apartment amenities include swimming pools, bike storage, Wi-Fi and party rooms. But the list certainly doesn’t end there.

| www.REMInetwork.com | July/August 2019 | 17

COVER STORY >>

Opened by Tricon House in November 2018, “The Selby” is an example of a new purpose-built rental building designed with a specific audience in mind: young, urban professionals seeking residence in the downtown core.

The stunning 50-storey building located in the heart of downtown Toronto marks the introduction of Tricon House, a division of Tricon Capital Group. As a relatively new player in the Toronto rental space, Tricon House is already on its way to setting a new standard for rental living, developing buildings that are “defined by design excellence, with suites curated for end-users, high quality amenities, elevated service levels, reimagined common spaces and resident programming that fosters community.”

Focusing primarily on the millennial market, The Selby offers residents what it describes as “a lifestyle that inspires comfort, connection and a sense of belonging through the first-of-its-kind millennial-centric services and experiences.”

18 | Canadian Apartment | Part of the REMI Network |

The reason for this specificity? Simply, that the need in Toronto was there and Tricon House saw an opportunity to fill it. Look no further than a recent Abacus Data survey of 18- to 37-year-olds, in which 40 per cent of the 2,000 participants said their generation is “mostly” or “much worse off” than their parents. Additionally, a whopping 54 per cent said that the economic system in Canada benefits other generations over theirs. Meanwhile 17 per cent said they believed they would “never own a home” and 37 per cent indicated they wouldn’t be ready to buy for at least another five years.

With these homeownership challenges in mind, Tricon House set out to create The Selby.

“Early residents are embracing not just the premium amenities at The Selby, but also the sense of community Tricon House intends to inspire,” said Gary Berman, President and CEO of Tricon Capital Group. “Tricon House provides phenomenal amenities you simply do not find on this scale anywhere else, and they’re designed with our residents in mind, making The Selby their home and not just the place they rent.”

COVER STORY >>

Delivering an elevated resident experience Aside from the 3,500 square-foot fitness facilities, wellness spa, outdoor common areas and pool, The Selby residents get to make use of 24hour parcel lockers, smart technology, pet grooming facilities, an onsite café and more. By partnering with select brands to grant residents exclusive access to millennial-centric services and deals, Tricon House is going beyond its physical amenities by setting its sights on enhancing residents’ lives.

The Selby building amenities: • 24-Hour Parcel Lockers • Bicycle Room • Biking & Walking Paths • On-site Concierge in partnership with Toronto Life • 3,500 sq. ft. state-of-the-art gym and yoga/spinning studio in partnership with BioSteel • Games room & club room • On-site café, bistro, bar and lounge called “Maison Selby” by Oliver & Bonacini • Outdoor Kitchen & Lounge • Resident Lounge and Catering Kitchen • Outdoor Pool & Deck Terrace • Private Theatre • Spa with wet dry sauna, deluge showers and meditation area designed by Partisans • Private off-leash dog parkette • Dog spa with grooming area • Underground Parking • Video Surveillance

| www.REMInetwork.com | July/August 2019 | 19

COVER STORY >>

“Early residents are embracing not just the premium amenities at The Selby, but also the sense of community Tricon House intends to inspire.”

Examples of some of the resident programming currently on offer: Eye Buy Art Accessible Art Program: For budding art collectors, Tricon House offers residents a gateway to discover and collect original art from award-winning artists featured on Eye Buy Art. The online platform allows residents to collect with confidence and have access to exclusive deals.

Curated furnishing through Wayfair and Casper: For those looking to have an immaculate suite, Tricon House has joined forces with Wayfair and Casper to offer residents discounts on mattresses, pillows and sheets, along with access to a selection of furnishings suited for The Selby.

Concierge Services powered through Toronto Life: Residents will always be in the loop with exclusive content and priority access to information on the best the city has to offer. Residents will receive Toronto Life’s hottest news about the top new restaurants, bars and galleries.

The James, located in Summerhill/Rosedale

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“Toronto residents are increasingly in need of rental housing options that are professionally managed, have easy commute times, and match their lifestyles,” said Berman. “Thoughtfully designed and appointed purpose-built rental apartments have been a mainstay housing option in U.S. cities for years. We are leveraging our experience in the U.S. and Canada to bring a new type of rental offering to Toronto. Our goal is to create communities that reflect the changing needs of a worldclass city, to deliver buildings of exceptional quality, and to set the bar for a new type of city living.”

Meanwhile, Tricon House is working toward the eventual opening of several new rental properties in Toronto, including: The James in Summerhill/Rosedale, The Taylor in the city’s Fashion District and a residential development in the eastern part of downtown Toronto called West Don Lands. Once opened over the next few years, Tricon House will have over 3,000 much-needed rental units across Toronto filling that housing void.

Find out more by visiting: www.triconhouse.com

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Q&A CASH MANAGEMENT CHALLENGES Financial solutions for residential property stakeholders

Residential property stakeholders face a broad range of cash management challenges. Whether related to collecting payments, managing funds, or minimizing the risks of fraud, there are no shortage of considerations. Yet while financial considerations are key, they can be hard to tackle without the right services, advice, and expertise.

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Here to discuss some common cash obstacles and available solutions is Nancy Matheos, Assistant Vice President and Deputy Manager with Canadian Western Bank.

What are among the most common cash management issues for property managers, owners, or board members?

CDIC [Canadian Deposit Insurance Corporation] coverage is certainly number one as they all have requirements to have all or a vast majority of their funds covered. Every property manager/ board we have dealt with has had the same concern keeping reserve funds separate from their operating and finding highinterest vehicles that can be separate, flexible, and offer some liquidity for reserve funds.

Another common challenge is being able to auto-debit renters or residents (in the case of condominiums) and pull one-off payments as needed, as well as deliver convenient and effective timing to deposit monthly where cheques are still collected.

What about on the regulatory side?

Regulations are always changing in this industry. That's where working with a third-party financial partner can be extremely helpful in understanding how regulations may impact one's cash flow and getting the best insights and advice to move forward responsibly.

What are the risks of not handling these cash management issues effectively?

The most obvious risk is financial loss, but there's also the risk of losing tenants, whether they have been with you for years or new tenants. Owners also risk receiving a Special Assessment to Owners if reserve funds are not managed well and a need arises.

How does one begin to address these challenges?

The challenges are common, but each property is unique. Ultimately, when we meet with new condo clients, we try to understand the whole picture, from the

number of units they manage to what the long-term needs and goals are for the group. You need to do that high-level review of the whole business and the people, and not just the finances, so you can plan accordingly, optimize interest, and ensure the safety of your funds.

What financial products/services are available to assist with that?

Canadian Western Bank, Canadian Western Trust, and Valiant Trust can all hold funds covered under CDIC, providing property owners three times of insurance if used fully.

As for specific solutions, our business savings account has a very competitive interest rate with full liquidity and no monthly fee. We also offer short and long term GIC’s and our 93 Day Flex Notice Account with very competitive rates and the flexibility to lock it in for a short period of time – all of which can be renamed to reflect Reserve Funds to keep them separate.

As for the issues of auto-debit, CAFT is our EFT/Direct deposit system and can be tailored to fit the needs of the condo plan/association, whether that's pulling monthly payments on an automatic schedule; having separate profiles for credit or debit; or the ability to separate profiles for regular fees/ rent, utilities, manual payments, reimbursements, etc.

Lastly, we have services like our Remote Deposit Capture (RDC), which gives clients the ability to deposit cheques from the convenience of their office. Additionally, our Business Online Banking platform consolidates accounts to one login so that owners can see all property bank accounts on one platform.

Having an informed and future-looking cash management strategy can go a long way towards making the job of a property manager go more smoothly. Nevertheless, busy schedules and knowledge gaps can make this aspect of the role a challenge. Herein, there is value in seeking financial partners who know your business, can ask the right questions, and look out for your best financial interests.

For more information, insights, and advice, visit Canadian Western Bank at www.cwbank.com/find-your-focus

Breathing Life into Outdoor spaces Exterior design tips from Deckorators’ Jase DeBoer In the summer months, there’s no denying that people would rather be outside, basking in the warm, fresh air. But for multi-residential building residents, finding that comfortable outdoor space isn’t always easy.

Not all apartment units come with balconies and not all properties are designed with shared spaces in mind.

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o what are the basics of creating inviting, communal outdoor spaces that will attract residents and give them that open-air refuge they deserve? According to Jase DeBoer, Senior Category Marketing Manager, Deckorators, it all comes down to safety, aesthetics and functionality.

Lighting the way…

Rooftop patios, meandering walkways and strategically placed benches amid beautiful

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gardens can be attractive havens for tenants, day or night, provided they are well-lit for both ambiance and safety.

Cap lights are a popular way to add lighting to any deck space, says DeBoer.

“Both solar and low voltage options are available and will add ambiance to any property, while step lights and decorative post sconces are equally stylish and effective.”

Another method commonly used to enhance a property is “spotlighting”. By

shining a light on key exterior features, like fountains, flowerbeds, shrubs or signage, the other benefit is that crucial sightlines are created for residents out strolling in the evening hours, while acting as a deterrent for unlawful activity.

Poolside safety For apartment buildings equipped with outdoor swimming pools, the arrival of summer means these cordoned-off areas are about to become hubs of boisterous activity.

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“Shared spaces often come with a great deal of use, therefore you will want products that will last while being beautiful and functional.”

But appealing as they are, swimming pools can be burdensome and costly to maintain.

Aside from the upkeep of the pool itself, the surrounding area must be beautifully landscaped, well-lit, comply with all safety standards, and designed with a surface area built to withstand moisture while providing great traction to avoid slip and falls.

DeBoer advises property managers to invest in decking material and technology that will withstand the elements while putting the safety of residents first.

“Composite decking technology has evolved, delivering greater surface traction than traditional materials,” he says. “Perfect for pools, hot tubs, docks and more, composite decking is incredibly strong and lightweight, making it an ideal solution for balconies and shared patio spaces.”

Railing options that provide safety without obstructing the view is also something DeBoer recommends. A variety of styles are available today—from sleek, contemporary aluminum railings in brushed titanium finishes, to classic rails in colours and tones that blend well with the scenery, railings can enhance a pool area while still fulfilling the important function of keeping residents safe.

“To help create a cohesive space, consider incorporating the same decking material for built-in planters and benches or even on top of the railing,” he says. “This offers a larger surface area for setting down beverages or snacks when entertaining.”

Same space, different tastes Shared spaces bring many competing tastes and colour preferences – in other words, catering to a building full of residents isn’t easy. For this reason, most designers will encourage building owners to opt for simplicity in their décor and landscaping choices. Seasonal planters add a lovely touch to an entranceway but they shouldn’t be too busy or require significant upkeep.

On the deck-front, while many decking options feature trendforward colours and textures, a safe bet may be something timeless and appealing to all. It’s also important to keep durability in mind.

DeBoer notes, “Shared spaces often come with a great deal of use, therefore you will want products that will last while being beautiful and functional. Consider products that offer extended warranties to ensure the space looks good for years to come.”

MOBILE FRIENDLY

Jase DeBoer is Senior Category Marketing Manager at Deckorators. | www.REMInetwork.com | July/August 2019 | 25

NEWSWORTHY >>

Industry Hot Topics New mixed-use development coming to Montreal’s Molson site

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n July, a Quebec consortium announced it had finalized the purchase of Montreal’s Molson brewery site, clearing the way for a redevelopment that will introduce “diverse housing alternatives that meet the needs of the neighborhood and future residents.”

The consortium consists of Selection Group, Montoni, and the Fonds immobilier de solidarité FTQ. It intends to redevelop the former Molson site on Notre-Dame Street into a district featuring a variety of rental units, condominiums, and retail outlets.

“We want to provide Montrealers with a complete, lively neighbourhood that combines quality of life, an employment hub and respect for the environment,” said Réal Bouclin, Founding President and Chief Executive Officer, Selection Group. “When the Molson family set up its brewery on the banks of the river at the end of the 18th century, it foreshadowed the city’s industrial development. Today, Selection Group wants to play a leading role in the transformation of this part of downtown Montréal.”

The consortium plans to make the neighbourhood greener and take full advantage of the nearby St. Lawrence River. Moreover, it aims to make the area more engaging for community members and tourists alike.

“The site will remain an important employment hub and will also be transformed into a lively neighbourhood that will be swarming with residents,” said Normand Bélanger, President and Chief Executive Officer, Fonds immobilier de solidarité FTQ, adding, “The next steps in this structuring project will be inspired by the common goal of successfully transforming the area.”

Molson Coors will relocate its head office to the future site. Company president and CEO added that the consortium’s vision is fitting for the riverside area, noting, “It goes without saying that Molson Coors is naturally very attached to the Montréal island site and the sales process was rigorously structured to ensure a lasting legacy for Montrealers that Molson could be proud of.”

Carbon pricing reappears on Ontario gas bills

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arbon pricing has been reinstated on Ontario’s natural gas bills 10 months after utilities were instructed to remove the levy that the provincial government has been seeking to quash. Since then, the federal government invoked the Greenhouse Gas Pollution Pricing Act (GGPP) as a replacement for Ontario’s dismantled cap-and-trade system and natural gas distributors have been remitting 3.91 cents per cubic metre (m3) since April 1.

The charge will reappear as a line item on customers’ bills beginning this month, equating to 3.91 cents/m3 of consumption.

In addition, the more nominal flow-through of the utility’s own carbon pricing costs for its buildings, equipment and fleet — known as the facility carbon charge — will be bundled 26 | Canadian Apartment | Part of the REMI Network |

into the delivery and transportation charge on each bill. In a filing to the Ontario Energy Board (OEB) earlier this spring, Enbridge Gas, Ontario’s predominant supplier to residential, commercial and industrial consumers, projected that would amount to $2.3 million province-wide in 2019, or about 0.2 per cent of carbon pricing collected from consumers.

As accredited intervenors at the OEB hearing, both the Building Owners and Managers Association (BOMA) of Toronto and the Federation of Rental-housing Providers of Ontario (FRPO) urged that the facility carbon charge also be visible as part of the carbon pricing line item.

However, the OEB decision concurs with a countering argument from Enbridge that it could diminish transparency.

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“Having the federal carbon charge (customer-related) set out as a separate line on the bill will allow a customer to reconcile the amount of their bill to the legislated charge for carbon more easily than if it was combined with the facility carbon charge,” it states.

In total, it’s projected average residential customers will have to pay an extra $86 to $94 on their natural gas bills over the coming year. That has been factored into rebates of $154, for single individuals, to $307, for families, that Ontarians will receive after filing their 2019 income tax.

For businesses, the first round of the Climate Action Incentive Fund, providing grants of up to $250,000 for upgrades to energy efficiency, is now open for applications. A similar program for municipal, education and health care facilities has been promised.

Greg Rickford, Ontario Minister of Energy, Northern Development and Mines, did not to acknowledge the rebates and incentives in a statement issued August 1st. “This is just one more example of how the federal government’s carbon tax is making life more unaffordable for families and businesses and the people of Ontario deserve to know the full truth about its impact,” he bridled.

Brightside announces plans to redevelop five properties

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rightside Community Homes Foundation, one of Vancouver’s oldest and largest affordable housing societies, announced plans to redevelop five of its current buildings in an effort to respond to Vancouver’s housing crisis.

The properties are: Loyal Orange Manor, 1425 East 12th Ave; Edward Byers House, 1451 East 12th Ave; Alice Saunders, 2924 Venables St.; Macleod Manor, 8725 French St.; and Mount Pleasant, 325 East 6th Ave. The redevelopment plan supports Brightside’s overarching goal to renew aging buildings and double the number of affordable homes it provides over the next decade. The proposed projects would double the number of units across the sites to more than 450 homes.

“Vancouver is experiencing a significant housing crisis, with limited supply of affordable housing in the most expensive city in Canada,” said William Azaroff, CEO. “Brightside’s mission is to ensure people of all income levels have a home within Vancouver. Our proposed projects would deliver a significant number of new affordable homes to address both a backlog and new growth, all while supporting our existing residents through the process.”

Brightside also said it would prioritize support to existing residents while it pursues the creation of new homes that better meet the needs of residents aging-in-place, while improving environmental sustainability and access to affordable housing for those who need it the most.

The proposed range of new homes will offer a variety of below market rent options for different renter profiles depending on the type of project structure (shelter rates, Rent Geared to Income, and affordable market rates for seniors, families and people with disabilities).

“The people who call Brightside buildings home today will continue to be a part of the Brightside community, and will be able to call those same buildings home again in a few years’ time, while paying the same rents, having access better amenities and safety features that are more adequate for agingin-place,” said Carolina Ibarra, Director of Strategic Initiatives for Brightside.

Jill Atkey, CEO of BC Non-Profit Housing Association (BCNPHA), added: “Redevelopments in the community housing sector are critical to tackling the affordability crisis in a city like Vancouver with very limited new land space, and ambitious affordable housing targets.”

Brightside’s approach to community engagement will go beyond City of Vancouver requirements, and will require a collaborative approach that includes support from all levels of government, other non-profit housing providers and public consultation.

During this proposed redevelopment process, the sites for Edward Byers and Loyal Orange Manor will be combined, meaning these five sites will be redeveloped into four new buildings.

The standalone monthly SAAR of housing starts for all areas in Canada was 245,657 units in June, up 26 per cent from 196,809 units in May. The SAAR of urban starts increased by 26 per cent in June to 234,238 units. Multiple urban starts increased by 31 per cent to 185,804 units in June while singledetached urban starts increased by 8 per cent to 48,434 units.

Rural starts were estimated at a seasonally adjusted annual rate of 11,419 units. | www.REMInetwork.com | July/August 2019 | 27

NEWSWORTHY >>

from proposed temporary modular housing, to mixed-market rental, to housing co-operatives.

Projects funded through this initiative include: • 1001 Kingsway • 1210 Seymour Street & 560 Davie Street • 177 West Pender Street • 3310 Marine Way • 3279-3297 Vanness Avenue • 1190 Burrard Street & 937 Davie Street • 3183 & 3245 Pierview Crescent • 288 E Hastings (The Anjok) • 2305-2355 Vanness Avenue (proposed temporary modular housing)

Government of Canada makes significant investment in affordable housing in Vancouver On August 7th, the City of Vancouver announced that the Government of Canada, through CMHC, will invest up to $184 million for the construction of affordable housing on city-owned sites. In total, up to 1,100 units across Vancouver will be funded through this initiative.

With the help of the City’s Vancouver Affordable Housing Agency (VAHA) and the Community Land Trust, a non-profit real estate developer and asset steward, and in partnership with the Government of British Columbia, CMHC is engaging proponents on nine projects,

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CONTACT Michael Gnat Phone: 416-635-4835 Email: mgnat@midnorthern.com

28 | Canadian Apartment | Part of the REMI Network |

“Today is a great day for housing in Vancouver,” said The Hon. Jean-Yves Duclos, Minister of Families, Children and Social Development and Minister responsible for Canada Mortgage and Housing Corporation. “The federal government is making an historic investment in housing that will help provide a safe and affordable place to call home for up to 1,100 families. With today’s announcement we are building on our investments that have helped over 1 million families across Canada.”

Leveraging several National Housing Strategy initiatives, CMHC is guiding applications for its National Housing CoInvestment Fund (NHCF), Rental Construction Financing initiative (RCFi) and Affordable Housing Innovation Fund.

The first project to receive funding, Pierview Homes, is under construction in the River District of southeast Vancouver and is set to open in 2020. The 140-unit co-operative housing development delivered by Community Land Trust on City-owned land is receiving a $53 million investment under the RCFi. “I want to personally thank Prime Minister Trudeau and Minister Duclos for partnering with the City of Vancouver to deliver the housing we need,” said Mayor Kennedy Stewart, City of Vancouver. “This landmark commitment helps us activate over $96 million in City-owned land, grants and waivers, demonstrating what happens when governments work together in partnership and deliver on their promises. The combined funding in today’s announcement represents an incredible quarter billion-dollar investment in building a Vancouver that works for everyone. I look forward to similar future announcements to further address homelessness and secure the future of existing cooperative housing in the city.”

With a budget of $13.2 billion, NHCF gives priority to projects that help those in greatest need, including women and children fleeing family violence, seniors, Indigenous Peoples, people with disabilities, those dealing with mental health and addictions, Veterans and young adults.

Through the NHCF, the Government of Canada will work with partners to build up to 60,000 new affordable homes and repair up to 240,000 existing affordable and community homes over the next 10 years.

A map showing the location of all announced provinciallyfunded housing projects in B.C. is now available online at: www. bchousing.org/homes-for-BC

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Rising Water, Rising Claims Canada’s tightening insurance market

by Andy Schwartze Last fall, Canadians were warned about the significant upward spike in claims levels from the same period in 2017. Today that growth in claims has been confirmed at 22 per cent. This rise was largely due to the increase in weather-related anomalies that impacted property owners—from the forest fires in the west and massive flooding in the east, to the unusually high wind storms in the central regions of North America.

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ince 2013, weather events have increasingly dominated national headlines. One major news channel recently reported that the National Weather Service in the U.S. had already recorded 1,000 tornados in that country.

As I write this article, Tropical Storm Barry is wreaking havoc on the Mississippi River area. By the time Hurricane season wraps up this fall, one can only imagine the damage to come.

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So, what does all this have to do with apartment owners?

Approximately 40 years ago, property insurance was purchased in multiple policy formats. A broker would present his client’s insurance requirements to a long list of insurers, and each carrier— based on the size and strength (not to mention subjective willingness) of its balance sheet—would commit to taking an acceptable “piece of the action”. The

growth of insured values in the burgeoning economic world of the 70s, made this process somewhat cumbersome as some insurance buyers would find themselves having to buy multiple insurance policies in order to be able to get the coverage amounts they needed.

To deal with this, insurers began to look more seriously at the world of reinsurance. By bringing in one or more of the major international reinsurers

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as we are only dealing with kitchen fires and other very “localized” claims, the raising of insured values every year helps increase dollar flow to insurers in accordance with the growth of labour and material costs. It’s an absolutely good match between claims and inflation, in the construction world.

But weather has now intruded on this decades-long premium/claims balance and the property insurance community, always a bit slow to react, is starting to realize that these old insurance rates may no longer be relevant. Hence, the market is changing and the simple fact is that “rates” are going to go up. To what extent is always up in the air, as insurers and their reinsurers try to figure out where the new balance needs to be. But, for those of us who are insurance buyers, as insurance brokers acting on behalf of a client, we need to be honest with our clients and

make certain that they understand that the rating of the past is now being pushed by the weather issues of the present.

You can call it climate change, it really does not matter. On July 11 in Washington, DC, there was severe flooding that resulted in people standing on the roofs of their cars calling for help on a cell phone. A couple of days later, “Barry” swept in to flood the New Orleans area. The Great Lakes floodplain has produced such enormous amounts of water that the flood management system, at Hawkesbury and Cornwall, has had to hold back water so as to avoid the total flooding of Montreal’s west end. Water levels are even worse than in 2018.

For those who think that being claimsfree is a route to lower insurance rates, it no longer counts. Contributions to the North American premium pool are going to go up. It’s written in stone.

Andy Schwartze, BSc., MBA, CIP, is an insurance broker specializing in property management and real estate. He can be reached at andy@takecover.ca.

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(i.e. Munich Re, Swiss Re and General) a carrier could offer higher coverage levels and sell off a piece of this to one of these big players. It was, and remains, a very practical solution that enables a buyer to arrange for an insurance contract that offers high coverage limits under one policy that is pieced out, behind the scenes, to a number of these reinsurance companies.

The drawback of this system is that reinsurers are not “local” insurance companies. Their exposures are worldwide and they, like all insurers, determine their premium charges to our local insurers on the basis of their worldwide claims experience.

Thus, a Canadian insurance buyer is, in part, paying in to the fund that also pays claims in other parts of the world, but more particularly in North America. A hefty hurricane in the U.S., that drains a reinsurer’s resources, is charged back in part also to Canadian insureds.

So, in the Canadian market, every premium that we pay includes a contribution to these “international” claims, although the impact is mostly a North American one and not to any huge effect a worldwide one. Now, since the 70s policy coverages have expanded significantly for a couple of reasons. Firstly, dedicated insurance brokers have realized that it’s a lot friendlier to be able to tell a client that a loss is covered, as opposed to apologizing for the lack thereof.

Secondly, lenders have become aware of the fact that their financial exposures are significant and they began, some years ago, to use independent insurance consultants to make sure that coverage was as broad as the market could offer. Both of these developments have colluded to broaden coverages in a way that, quite obviously, widened the claims envelope so that, in today’s market, coverage is far broader than it was decades ago.

In all these years, however, the pricing of insurance has remained pretty low.

A prime example is that, back in the 1980s, an apartment building owner could expect to pay about 5 cents per $100 for insurance on a concrete highrise. That remains the yardstick by which experienced property management supportive insurance brokers judge an insurer’s quote. This standard has been around now for almost 40 years As long

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Smart Ideas

WHAT RENTERS REALLY WANT …when it comes to amenities

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ocation and budget considerations aside, what are renters looking for as they search for their ideal apartment? According to U.Sbased Zumper.com, you might be surprised by what the online apartment finder’s top searches tell us:

1. Air conditioning matters…a lot. Sweating it out in the summer months isn’t an option for most.

2. In-unit laundry is no longer a perk. According to the average apartment hunter, it’s a must.

3. While parking is still considered important, assigned parking is a requisite. When offering parking as an amenity, stalls should most certainly be designated.

4. Who doesn’t want a balcony? Not many, according to top searches.

5. Do renters still prefer hardwood over carpets? The answer is a resounding yes.

LEAST-SEARCHED AMENITIES On the other end of the spectrum, what do renters care about the least when it comes to their future rental building?

Surprisingly, rooftop decks, dry cleaning services, resident lounges and package services were among the least searched amenities by Zumper users.

For the complete list, visit www.zumper.com 32 | Canadian Apartment | Part of the REMI Network |

Affordable Housing Conservation Program

Comfy living for tenants.

Comfy energy bills for you.

Visit uniongas.com/ affordablehousing to learn more

We’ll cover up to 50% of the cost when you upgrade to high-efficiency equipment The Affordable Housing Conservation Program provides financial incentives for high-efficiency space and water heating equipment, heat recovery, building automation systems and more.

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