Crestpoint Real Estate Buys Three Properties, Including Former Nhl Rink

Maple Leaf Gardens was where Toronto Maple Leafs last hoisted the Stanley Cup

Crestpoint Real Estate Investments has purchased a 50% stake in three properties from Loblaw Properties, including an interest in the historic Maple Leaf Gardens that once was home to Toronto’s NHL team.

Toronto-based Crestpoint did not reveal a price but said it would have $10.4 billion in assets under management and 38.3 million square feet upon closing the acquisition.

Crestpoint acquired the property interests in the portfolio from Loblaw Properties Ltd. and Shoppers Realty as part of a 50-50 joint venture with an affiliate of Choice Properties Real Estate Investment Trust. Crestpoint said it entered into the joint venture transaction with Choice Properties, Canada’s largest real estate investment trust, on behalf of its Crestpoint Core Plus Real Estate Strategy open-ended fund.

The deal includes a 150,000-square-foot Real Canadian Superstore in Winnipeg, Manitoba, and a strata title interest in the lower floors of 60 Carlton St. in Toronto, formerly Maple Leaf Gardens. Constructed in 1931, the building was the home arena of the Toronto Maple Leafs until 1999. It’s the arena where the NHL team last won the Stanley Cup in 1967.

The arena site now houses 95,000 square feet of retail space, including a flagship Loblaws grocery store, an LCBO outlet, a Joe Fresh location and 150 underground parking spaces. Toronto Metropolitan University will retain ownership of the top level of the property, which houses the Mattamy Athletic Centre.

The multiproperty acquisition also includes a 711,000 distribution centre in Mississauga, Ontario.

Crestpoint said the portfolio is fully leased and backed by Loblaw’s and Shoppers’ investment-grade credit parent company, Loblaw Companies Ltd.

Source CoStar. Click here for the full story.

UBS To Sell Offices in US, Canada As Valuation Declines Weigh on Fund

Swiss Bank To Shut $2 Billion International Fund Amid Mounting Redemption Requests

UBS Group plans to liquidate a $2 billion real estate fund holding 12 office properties in the United States and Canada in the latest sign that investors are pulling funds out of the troubled commercial real estate market.

The Swiss bank plans to liquidate the properties in its Credit Suisse Real Estate Fund International, a fund it acquired after Credit Suisse collapsed in 2023, UBS said in a statement.

The announcement comes as share redemption requests by investors have exceeded permitted amounts allowed by such property giants as Blackstone Real Estate Income Trust and Starwood Capital, as property values have declined amid persistently high interest rates and recession concerns.

Real estate loans estimated at nearly $2 trillion in the U.S. are coming due within the next two years, a time when some investors have been unable to weather a combination of low demand for corporate office space — from both tenants and investors — and high interest rates.

The Credit Suisse Real Estate Fund International contains 53 properties across the globe, roughly 80% of which are offices, according to a company filing. The fund includes nine office properties in the U.S. and three in Canada, with the remaining assets in the United Kingdom, Europe, Australia, New Zealand and the Asian Pacific Rim.

UBS said the valuation of the fund’s global property portfolio declined 12% between Dec. 31, 2023, and June 30, 2024, based on the bank’s latest appraisals.

The U.S. properties in the fund include:

Third + Shoal, a 29-story office tower at 607 W. Third St. in Austin, Texas
250 S. Wacker Drive, a 16-story office, and the four-story 1333 N. Kingsbury St. in Chicago
4555 Airport Way, a four-story office in Denver
The eight-story 207 Goode Ave. in Glendale, California
777 Post Oak Blvd., a mid-rise office building in Houston
1320 SW Broadway St. in Portland, Oregon
101 Elliott Ave. W in Seattle
1099 New York Ave. NW in Washington, D.C.
The Canadian properties in the fund include 121 Bloor St. E and 160 Bloor St. E in Toronto, and The Exchange, an office property at 475 Howe St. and 819-829 W. Pender St. in Vancouver, British Columbia.

The fund had faced investor redemption requests, but UBS said meeting the requests would require selling assets at an “inopportune time” that would affect existing investors. The Swiss bank concluded it was better to start an “orderly liquidation” of the entire fund, according to the statement released Thursday.

“Given the current limited liquidity of the real estate markets, property sales and payments of liquidation proceeds will be made over several years,” UBS said in the statement.

Nontraded real estate investment trusts allow retail investors to own shares in a managed portfolio, but place restrictions on taking out money in case there is a rush to the exit door.

Such trusts have clamped down on redemption requests as they have sought to shore up liquidity in the face of a wave of investors looking to exit as property values decline.

Billionaire Barry Sternlicht’s Starwood Capital, based in Miami Beach, Florida, in May limited redemptions from its nontraded $10 billion Starwood Real Estate Income Trust property fund.

The $60 billion Blackstone Real Estate Income Trust, the largest of the nontraded REITs, was the first to limit redemptions in 2022. In February, it lifted the restrictions and saw its shareholder buyback requests decline in the following months.

Source CoStar. Click here for the full story.

Coworking Survey Says Right Combination Of Incentives Could Lure More Workers Back To The Office

iQ Offices invests in new property in Toronto, notes interest in higher-quality workspace

The chief executive of one of Canada’s largest independent coworking office providers said his company’s latest survey would seem to be a study in contradictions.

The survey done on behalf of iQ Offices by Maru Public Opinion found that 43% of respondents prefer to work in-office full-time or in a hybrid capacity compared to fully remote positions, but the same percentage of respondents said they don’t like their current office conditions.

“People just don’t think coming into the office creates an encouraging and enjoyable work environment,” said Kane Willmott, CEO of iQ Offices, in an interview.

The survey, conducted between July 1 and 2 among 859 randomly selected employed Canadian adults, found 34% dislike the workspace in their current office.

The survey also found that 54% of respondents believe their current space is outdated, while 47% said it is out of touch with what they need in a work environment. Respondents could select multiple reasons.

“You look at (public discussion), and it’s about no one wants to return to the office and about the benefits of remote work, but no one talks about the quality of the workspace they are going to,” said Willmott.

Tapping employee sentiment
iQ Office, with coworking locations in Ottawa, Montreal, Toronto and Vancouver, has a stake in people returning to the office and has doubled down on that bet with the decision to open a new location at 302 Bay Street in Canada’s largest city. The new location is expected to open on December 1.

“We did this survey because there just was not a whole lot of data that talks about sentiment around the office when you get there and whether that situation would improve if we improved the experience,” said Willmott.

The company’s latest location is a 14-storey building connected to Toronto’s underground Path system that links the core’s buildings, a convenience that iQ Office hopes may address some of the issues the company found in its survey.

That survey found that 76% of respondents said they could be enticed back to the office if it had a well-designed working environment, perks like free snacks and beverages, a central location, and convenient amenities.

Asked to list what would influence them to return to the office, 42% cited ease of commute, 38% said comfortable, dynamic workspaces and 35% said in-person collaboration.

Willmott said another trend he is seeing is companies setting up small offices for short periods of time, utilizing the space three days a week.

“We call that a sprint space and it’s almost like an event. We are working with a large technology company that wants six-week sprints, three days a week, and brings people in from all over the world,” said Willmott.

Source CoStar. Click here for the full story.

Toronto High Park Development Site Sold To Hepsor, Elysium, Oikoi

Acquisition is Estonian company’s fourth, with Elysium, as it continues to expand in Canada

Hepsor, its Canadian partner Elysium Investments and International Property Group/Oikoi Living have acquired a development property in Toronto’s High Park neighbourhood on which there are plans to construct a two-tower residential project.

The acquisition of its interest in the property assembly is Hepsor’s fourth investment in Canada. The company is based in Estonia, and initially entered the Canadian market in 2023.

“Entering the High Park development was another step in implementing Hepsor’s strategic plan,” Hepsor’s chairman of the board, Andres Pärloja, said in the announcement. “In the spring of 2022, we decided that part of our business should be outside the European economic area and away from the Russian border. We chose the dynamic and rapidly developing Canadian market.

“We plan to continue expanding our positions in Canada to the extent possible and are constantly looking for new and interesting investment opportunities.”

Elysium Investments and IPG/Oikoi are both Toronto-based investment, real estate and development companies.

The High Park acquisition

The acquisition involves an assembly of 11 properties at 21-29 Oakmount Rd. and 26-36 Mountview Ave. in the upscale Toronto neighbourhood. As Hepsor notes in the announcement, “High Park is one of Toronto’s most sought-after residential areas, offering abundant greenery, excellent recreational opportunities, and convenient access to public transportation”.

The development area is planned to feature a high-rise building with rental apartments in two towers. It is the first Canadian project for which the company plans to also include Estonian private capital investors.

The total investment value of the property and the first phase of the project is approximately $89 million, Hepsor states. High Park Limited Partnership, established for the project’s development, will invest approximately $12.5 million.

To accommodate the first phase of the project, the company will seek a zoning amendment from the city. It also states planning activities will be initiated for the construction of a residential rental building. Development of the first phase is expected to last 24-30 months.

Hepsor’s Canadian expansion

Hepsor’s residential development portfolio in Toronto includes interests in four development projects. During October, a fifth transaction under the same program is expected to be completed, which, when added, would mean that Hepsor and its partners have approximately 2,500 new apartments in their development pipeline in Toronto.

In addition to its residential development program, Hepsor is “actively seeking opportunities for the development of warehouse and logistics spaces in the vicinity of both Toronto and Montreal”.

About Hepsor

Hepsor AS is one of the fastest-growing residential and commercial real estate developers in Estonia and Latvia, and also operates in the Canadian market. Over the last 13 years Hepsor has developed more than 1,800 homes and approximately 388,000 square feet of commercial space.

The company also considers itself an innovator in the Baltic States, implementing engineering solutions that make its buildings more energy-efficient and environmentally friendly.

The company’s portfolio is comprised of 24 development projects with a total sellable space of almost 1.9 million square feet.

EDITOR’S NOTE: This article was updated after being published with additional information provided by IPG/Oikoi and Elysium.

Source Renx.ca. Click here for the full story.

Toronto Remains A Top Tech Talent Market, But Leasing Activity Slow

CBRE report ranks Toronto as 4th-best North American market, has largest job growth since 2018

Toronto has moved up a notch to No. 4 in CBRE’s latest Scoring Tech Talent report ranking North America’s Top-50 technology markets. Eleven Canadian cities are ranked in the report, including three emerging markets.

Toronto created 95,900 tech talent jobs between 2018 and 2023, representing 44 per cent growth in that period and the most job gains of any market.

With CBRE reporting an 18.5 per cent national office vacancy rate in the second quarter of this year, the sector is not driving a lot of leasing today, but CBRE Canada chairman Paul Morassutti told RENX the tech sector remains very important to the asset class.

“The rationalization of the tech sector over the last 24 months, we think, is very helpful in getting that sector healthy again and preparing for what we think will be a new wave of growth as we emerge from the sort of economic weakness that we’re in now,” Morassutti said.

Tech job growth across Canada

The 1.1 million tech workers in Canada accounted for 6.4 per cent of the country’s total workforce in 2023. The number of Canadian tech workers has increased by 30.2 per cent since 2019, substantially higher than the 7.5 per cent rise in total employment.

Technology sector jobs increased by 1.7 per cent or 18,400 in Canada last year, led by tech management and computer support positions across all industries.

While 15 of the Top-50 markets lost tech sector jobs from 2018 to 2023, only Calgary (78.1 per cent), Ottawa (51.7 per cent) and Waterloo Region (45.5 per cent) posted higher percentages of job growth than Toronto.

Though this tech job growth is good news for the overall Canadian economy, many people in the field can do much of their work remotely so there are still questions about how it will translate into occupied office space.

Morassutti doesn’t think tech office demand will return to where it was late in the previous decade when companies were leasing more space than they needed, thinking they would grow into it. But, he expects leasing to pick up again.

“Most of that demand is going to be for good-quality office assets, not for secondary assets,” Morassutti said. “The future for good-quality space I think is much better than people realize, and the future for commodity and secondary product might be worse than people realize.”

How other Canadian cities ranked

Ottawa, with more tech workers employed in government than in the tech industry itself, moved up one spot to No. 10 thanks to job growth. Waterloo Region, despite its job growth, remained at No. 18. Calgary improved by one position to No. 20.

Other Canadian markets didn’t fare as well. Vancouver dropped from eighth to No. 11, Montreal fell three spots to No. 15, Quebec City slipped five places to No. 40, and Edmonton dropped 10 spots to No. 49.

“All of those tech markets remain very strong,” said Morassutti. “I don’t really think there’s been anything that gives us concern. In fact, I think the research reinforces that in almost all of our major Canadian markets, tech continues to play a very important role.”

The scorecard for the rankings incorporated 13 metrics to measure each market’s depth, vitality and attractiveness to companies seeking tech talent, as well as to tech workers seeking employment. Each metric was weighted by its relative importance to job creation and innovation.

CBRE also ranks the next 25 emerging tech markets on a narrower set of criteria. London, Ont. ranked fourth on that list, with 88.5 per cent tech job growth in the past five years, while Halifax appeared at No. five and Winnipeg came in at No. 13.

Growing importance of artificial intelligence

Artificial intelligence (AI) is rapidly becoming a catalyst for growth, driving new tech talent hiring and office space demand. Toronto, Vancouver and Montreal are Canada’s leading AI markets, accounting for 60 per cent of the country’s 41,374 AI tech jobs.

“Over the last 12 months, it’s had a much more significant impact on the numbers than it had previously,” Morassutti said of AI’s increasing importance. “We’re seeing an awful lot of AI talent going into companies like banks and real estate companies and law firms as opposed to just being gobbled up by the NVIDIAs of the world.”

The tech industry employs almost half of all AI specialty talent, followed by the professional and business services and financial activities sectors.

“In Toronto we are working with several AI companies that are looking for new space and more space,” Morassutti noted.

Bigger political and economic issues

Morassutti said some of the Canadian government’s new policies — relating to immigration and foreign students and workers, a capital gains inclusion rate change and more — have raised concerns that “the economic backdrop in Canada is becoming less conducive to innovation and technology companies.

“And there is a greater concern that if we allow that to continue, and if we allow productivity or GDP (gross domestic product) per capita to continue to decline, a lot of this growth that we’ve enjoyed in Canada may end up going to the U.S.”

A housing shortage and high housing costs is an issue that ripples through every aspect of the Canadian economy, but Canadian cities are still considered a bargain and have the eight lowest estimated one-year company costs for tech talent among the top 50.

While talent used to trump cost in the tech sector, Morassutti said that narrative began to change in 2022 when interest rates rose and companies began to “transform from a grow-at-all-cost mentality to a focus on profitability.

“That’s why we’ve had so many layoffs. If expenses are now something that these companies are watching more closely, and Canada is half the expense of the U.S., I still think that very much works in our favour and it will continue to work in our favour going forward.”

Source Renx.ca. Click here for the full story.

Crestpoint Acquires Stake In Toronto’s Former Maple Leaf Gardens

Invests in commercial portion of former home of Toronto Maple Leafs as part of 3-building portfolio

Crestpoint Real Estate Investments Ltd., has acquired a portion of Toronto’s iconic former Maple Leaf Gardens building as part of a three-property portfolio it is buying into, in a 50/50 joint venture with a Choice Properties REIT affiliate.

The transaction, announced Monday, involves a distribution centre and two retail properties including the portion of the former Maple Leaf Gardens at 60 Carlton St. in downtown Toronto.

The distribution center is a 711,000-square-foot dual-load distribution facility in Mississauga. The other retail asset is a 150,000-square-foot Real Canadian Superstore in Winnipeg.

The 60 Carlton St., property is structured as a strata title interest in the lower floors of the building.

Financial details were not disclosed.

Originally constructed in 1931 and recognized as one of Canada’s most iconic buildings, it was the home arena of the NHL’s Toronto Maple Leafs, other professional sports teams and hosted other major entertainment events until 1999.

It now houses 95,000 square feet of retail space including a flagship Loblaws grocery store, an LCBO outlet, a Joe Fresh location and 150 underground parking spaces.

Toronto Metropolitan University will retain its ownership of the top level of the property, which houses the Mattamy Athletic Centre arena, sports and special events venue.

Loblaw, Choice and the Gardens

Loblaw had acquired ownership of the then-Maple Leaf Gardens for $12 million in 2004, according to reports at the time. After years of delays and planning, it open the redesigned retail portion of the building in 2011, including its flagship Loblaws retail store which retains a number of features from the former arena.

The Mattamy Athletic Centre, which now hosts the university’s sports teams as well as other events, was developed at the same time above the retail portion of the building.

The project was valued at about $60 million.

Loblaw spun out its real estate holdings into Choice Properties REIT in 2018.

Portfolio fully occupied

The three-building portfolio is 100 per cent leased for 15-plus years and is backed by Loblaw’s and Shoppers’ investment-grade credit parent company, Loblaw Companies Limited.

Crestpoint, on behalf of the Crestpoint Core Plus Real Estate Strategy (its open-end fund), entered into this joint venture transaction with Choice Properties (CHP.UN-T), Canada’s largest REIT with over 700 properties valued at $16.7 billion and a market cap of ~$10.6 billion.

The closing of this acquisition brings Crestpoint’s total assets under management to $10.4 billion and 38.3 million square feet.

Crestpoint is a commercial real estate investment manager dedicated to providing investors with direct access to a diversified portfolio of commercial real estate assets.  It is part of the Connor, Clark & Lunn Financial Group, a multi-boutique asset management company that provides investment management products and services to institutional and high net-worth clients.

With offices in Canada, the U.S., the U.K. and India, Connor, Clark & Lunn Financial Group and its affiliates collectively manage approximately $133 billion in assets.

Source Renx.ca. Click here for the full story.

Quadreal Acquires Toronto Queen St. W. Site For $24.25M

Property contains low rise commercial/residential building, offers redevelopment potential

QuadReal has purchased two low-rise buildings at 1149 and 1153 Queen St. W. in Toronto with the assumed intention of redeveloping the site into a multi-residential property.

The 0.64-acre, mixed-use-zoned site was owned by artist Ben Woolfitt. He previously operated an art supply store in the building at 1153 Queen that has commercial and retail space on the ground level and 10 residential units — all occupied — on the floor above it.

“He saw the potential of what the next phase of this property could be,” Lennard senior vice-president Vincent King, who brokered the off-market deal with sales representative Gabriel Irinici, told RENX.

King originally connected with Woolfitt in 2018 when the artist first thought about selling, but King said price expectations at the time were unrealistic. Ensuing efforts by other parties to get a deal done were also unsuccessful.

But the two men stayed in touch over the years and Irinici re-engaged the vendor a year ago, learning that his pricing expectations were more realistic.

Bringing QuadReal into the picture

The Lennard colleagues thought Vancouver-based QuadReal, a global real estate company that has assets under management valued at more than $77.6 billion, would be a good fit to acquire the property.

“They understood this node and have a proven track record . . . and we wanted to make sure that the group that we brought to the table was a group that was going to be true to their word and operate in good faith,” King said of QuadReal, which declined to be interviewed for this article.

The vendor and purchaser settled on a price of $24.25 million.

“The process of finding the right buyer and figuring out all of the details that would actually get a deal done took a while,” King explained. “But once we had the right group and were working with QuadReal, the deal actually happened very quickly.

“From getting the deal under contract to a closing date was inside of 60 days, which in the development world is a pretty quick deal.”

The neighbourhood and property’s current usage

King said QuadReal liked the Queen West neighbourhood as a proven node for both purpose-built rental and condominium properties, and it also has lots of stores, restaurants and bars nearby. It’s on the Queen streetcar line and the future King-Liberty GO Transit station is planned for just south of the site.

“It’s one of the largest parcels of land remaining on all of Queen West, with 233 feet of frontage,” King said. “There are very few development opportunities of this calibre left in the City of Toronto.”

There’s approximately 4,000 square feet of vacant commercial space at 1153 Queen, where the other tenants are a dental clinic, a convenience store, a tattoo parlour and a cosmetic/medical business.

There’s a cannabis store and a second-floor artist studio in the smaller neighbouring building at 1149 Queen.

Potential future use for site

“There’s a good amount of lease term on everybody, but we’re confident that QuadReal will be able to put its plans in motion when the time’s right,” King said.

King didn’t want to speak on behalf of QuadReal as to what those plans might be, but said: “Especially around transit, you’re seeing an increase in densities getting approved.”

Canada Post sold its 122-year-old former post office building just to the east at 1117 Queen St. W. to Queen Street Post Inc. for an undisclosed price in December 2021.

While much of that two-storey, 11,354-square-foot heritage building will be maintained and used as a community space, the new owner has proposed building a 29-storey, 272-unit residential tower above and behind it.

“I can’t say if that type of density will be achieved, but I think it’s fair to say that we’ll see more density and potentially more height than one would have expected in the past in this area,” King said.

Source Renx.ca. Click here for the full story.

There’s A Whole New Landscape For CRE Financing: Oakbank

Broker, advisory firm facilitates $148.8M construction loan from KingSett for Brixen condo project

Commercial mortgage broker and capital advisory firm Oakbank Capital Group was instrumental in arranging a $148.8-million construction loan from KingSett Capital to Brixen Developments to push forward a new Mississauga condominium development.

“A lot of the conventional lenders, being the big banks, have de-risked in a certain sense in that they’re not offering clients the same types of financing or the same structure of financing they would have historically,” Oakbank managing partner Jonah Brown told RENX.

“That has been a big catalyst for our business, in that everyone is looking for more unique structures or quicker funding timelines.”

Brown said Oakbank has funded around $1.4 billion so far this year and has around $700 million of commitments signed that it will close out before the end of the year.

That being said, Oakbank has also become more selective. It isn’t looking to be involved with any agreements that don’t have a high degree of certainty to produce positive outcomes for the company and its clients.

“As a result, we’re doing a lot more legwork up front to ensure the deals we take are high-calibre,” Brown said.

Brixen’s Exhale development

Brown said most institutional lenders cap their loans in the $50-million to $60-million range, so Brixen found the opportunity to work with a single lender for Exhale Residences very attractive.

“We do a lot of business with KingSett and we have nothing but good things to say about them, their platform and their capacity to execute,” Brown said, “and they came through and did the whole load.”

The project involved, known as Exhale, will be an 11-storey, 284-unit condo at 1381 Lakeshore Rd. E. Its amenities will include: a furnished lobby with an adjoining work lounge; indoor and outdoor gyms; a children’s playroom; a party room that includes a full kitchen and private dining room for 10 people; a rooftop terrace with barbecues and views of Lake Ontario; and a co-working space.

Ground was officially broken at the site in August. Occupancy is expected in the fall of 2026.

Brixen didn’t reply to requests to be interviewed for this article before it was written.

Residential, industrial asset classes are most active

Toronto-based Oakbank was launched in February 2022 and has arranged more than $3 billion in loans across Canada since then. Its core offerings include construction, bridge, mezzanine, Canada Mortgage and Housing Corporation (CMHC), and term loans. It customizes financing for properties ranging from $5 million to $450 million.

“CMHC has become and has continued to be a large part of our business,” Brown explained. “I think as the condo market has slowed down, a lot of developers are looking to build rental. Some are building conventionally and some went right to CMHC at the outset. Both are options in the market.”

Industrial, purpose-built rental and condominium residential are the most active asset classes that Oakbank is involved with financing, while it has also been involved with some office property transactions.

Brown cited a $62-million bridge loan it arranged in May involving two office buildings at 45 and 47 Sheppard Ave. E. in Toronto. The purchaser viewed it as a redevelopment play, thus it was seen more as a land loan with holding income rather than a traditional office transaction.

More options than just the major banks

Expert advice and advisory services become increasingly valuable as the commercial real estate market becomes more challenged, according to Brown, as companies are forced to look for a larger variety of capital sources.

“When people think of financing, I think the intuitive thought is you think the big five banks, when the reality is there are 70-plus lenders across Canada looking to invest in commercial mortgages,” Brown said, offering a snapshot of the current lending situation.

“Everyone has different risk appetites, everyone has different snack brackets, and our job is to keep a pulse on that market and know who’s looking to invest in what at any given point in time.

“And even though a project may not be a fit for the big five banks, we can almost always find someone that does have that risk appetite and pair the right capital.”

Source Renx.ca. Click here for the full story.

Amazon To Grow Toronto Tech Hub, Open Vancouver Office North Tower

Company updates plans for Canadian growth, opens atrium at its flagship The Post Vancouver office

Amazon will add 79,000 square feet of space to one of its Toronto offices by November and plans to open the North Tower of its Vancouver office complex in 2026, the company announced Thursday afternoon.

The tech giant made the reveals as it opened a 43,000-square-foot atrium at its flagship office building The Post in Vancouver, and launched its first high-tech Just Walk Out store in its YYZ14 office at 120 Bremner Blvd. in Toronto.

The expansion will take place at its YYZ18 office at 18 York St. in Toronto, where three new floors will be opened. Across Amazon’s three Toronto offices the company currently occupies approximately 500,000 square feet of space (excluding the upcoming expansion). It provides employment for approximately 3,500 staff members.

The Post has 1.1 million square feet of office space across its 21-floor South Tower and 22-floor North Tower linked by the just-opened atrium. Over 4,500 of Amazon’s employees work in The Post, where Amazon is the sole corporate tenant. The South Tower was opened earlier this year.

“Our investment in The Post reflects Amazon’s continued commitment to our Vancouver Tech Hub,” Jesse Dougherty, Amazon’s vice president, said in the announcement. “This new space will be an ideal location for our teams to gather and invent on behalf of customers.”

The Post’s atrium

The atrium at The Post is designed to feature collaboration spaces for Amazon employees with break-out areas, meeting rooms, a cafe and an event venue. B+H Architects designed the atrium, with QuadReal Property Group as its developer and manager.

Amazon emphasized the sustainability of The Post: a waste heat recovery system, passive solar shading, an energy-efficient envelope and light shelves that reflect daylight into the interior. The building is on track to acquire LEED Gold certification, Amazon states.

Approximately 25,000 tons of carbon was saved and “significant construction waste from local landfills” was diverted by reusing the building’s existing central podium, the company said.

Just Walk Out shopping in Toronto

As in Vancouver, Amazon is also partnered with QuadReal in Toronto. The YYZ14 and YYZ18 offices are located in QuadReal’s Southcore Financial Centre; the YYZ16 office is in Scotia Plaza, which is owned by Kingsett Capital and AIMCo.

Amazon’s Just Walk Out shopping allows customers entering the store to link their credit card, then a mix of artificial intelligence and sensors underpinning the system checks whether items are taken or returned to shelves. Customers leave without transacting at the traditional check-out line, and are automatically charged for the items they exit the store with.

Amazon will be rolling out its Just Walk Out shopping at YYZ14 for its employees and at YYZ18 later this year. Just Walk Out is already used at the Scotiabank Arena, Toronto Pearson International Airport and the Scotiabank Saddledome in Calgary among other Canadian and global locations.

Amazon expands offices despite office vacancies rising

Amazon looks to add more space as office vacancies in Toronto and Vancouver consider to be elevated due to corporate remote work policies.

Newmark’s 2Q ’24 Downtown Toronto Office Market Overview showed a 14.6 per cent vacancy rate in downtown Toronto during the quarter – a 24-year high. Avison Young showed similar data in its Q2 Greater Toronto office market report: vacancy rising to 14 per cent and availability at 20.2 per cent.

In Toronto, deliveries of new supply, the office real estate cycle, technology changing how tenants use office space, work-from-home policies and the COVID pandemic raised vacancy from pre-pandemic lows.

Downtown Vancouver’s office market had Q2 vacancy at 16.1 per cent, according to NAI Commercial’s Metro Vancouver Office Market Report Q2 2024. The high cost of construction and financing hurt the financial viability of some office projects, Rob DesBrisay, managing partner of NAI Commercial, told RENX in July.

“If you look at office across North America, investors are no longer keen on office. Nobody is looking to weigh heavier in office investment right now,” he said.

Colliers forecasts Canada’s office vacancy rate to reach a ceiling of 15 per cent by the end of Q2 2025.

Source Renx.ca. Click here for the full story.

Arkfield Has Short- And Long-Term Strategies For 10 Lower Spadina

Toronto developer, real estate owner acquires seven-storey downtown Toronto office property

Arkfield has acquired a seven-storey downtown Toronto mixed-use office building with long-term redevelopment potential from Dream Impact Trust for $23.7 million.

The 0.34-acre site at 10 Lower Spadina Ave. is occupied by a 62,163-square-foot building that, aside from a vacant former ground-floor Starbucks store, is fully leased with a 5.7-year weighted average lease term.

“One of our strategies in today’s market is owning income-producing, cash flow-positive assets,” Arkfield chief investment officer Rouh Ramezani told RENX. “Shorter term, the strategy is going to be focusing on the operation of the property. The tenants are high quality and we will operate the property to their standards.

“It’s the same with the ground-floor retail. We want to improve that retail experience in that area, given how great the location is in front of the park and the lake. We want to improve the operations of the asset to do justice to the location.”

The deal, brokered by TD Cornerstone Commercial Realty and CBRE, took about six months to close. Arkfield chief executive officer Ramin Jalalpour told RENX several bidders were interested in the property.

10 Lower Spadina’s redevelopment potential

The building’s tenant spaces and common area were recently modernized and underground parking is available.

The location at the northwest corner of Queens Quay West provides unobstructed views of Lake Ontario and offers convenient access to several nearby amenities, the Spadina streetcar, the Gardiner Expressway, Lakeshore Boulevard and Billy Bishop Toronto City Airport.

Toronto-based Arkfield is an integrated real estate group that owns, operates and develops commercial and residential assets in Ontario. Its portfolio totals more than 4.3 million square feet of residential density with an estimated completion value of $4.5 billion.

“Longer term, we will seek to find the best use for the asset and for that particular location,” Ramezani said.  “It could be a condo, a  purpose-built rental or an office. It’s too early to tell right now.”

The site has mixed-use zoning for office and retail, but would have to go through the rezoning process to be converted to residential use.

“This is not an asset we want to take to development immediately,” Jalalpour said, suggesting it could be five to 10 years before redevelopment is considered since the building is providing steady holding income.

The building’s page on Arkfield’s website shows a preliminary proposal for a 360,000-square-foot tower with 500 residential units.

Interest in site to the immediate north

Arkfield is also considering a possible future land assembly for the property. A 105-year-old City of Toronto-owned low-rise building immediately north of the site at 20 Lower Spadina Avenue could potentially be sold and Arkfield would be interested in acquiring it.

Jalalpour said his company has had initial conversations with municipal representatives about that possibility, but it’s still very early and the talks aren’t too serious at this point.

The 20 Lower Spadina building is currently occupied by Centre Francophone du Grand Toronto and Broad Reach Canada.

Arkfield’s development pipeline

Arkfield owns almost 20 income-producing and development assets, including several proposed multiresidential development sites along Yonge Street in north Toronto.

The most advanced of those is a condominium partnership with Tridel that’s in the pre-sales stage for a 14-storey, 246-unit building at 6080 Yonge St.

Arkfield is in the final stages of receiving zoning approval for a site at Yonge and Churchill Avenue where it’s proposing to build 45- and 33-storey towers with a combined 862 units and close to 14,000 square feet of retail space at grade.

“I don’t think we’re going to rush to launch this project anytime soon,” Jalalpour said, acknowledging the depressed state of the condo market at the moment.

Among the other development sites owned by Arkfield on, or close to, the north Yonge corridor are: 7-17 Nipigon Ave.; 7079 Yonge St.; 6200 Yonge St.; and 6125 Yonge St.

Arkfield’s investment strategies

Jalalpour said the company has capital available should a new opportunity come up to purchase another income-producing asset, with future redevelopment potential, similar to 10 Lower Spadina.

“We are an investment-oriented, sophisticated developer,” Ramezani added. “If you look at it from the finance and private equity real estate side, we are a more operation-heavy and development-heavy private equity real estate firm.

“We cover A to Z on land development projects. We have income-producing commercial projects. We have multires value-add and, of course, construction and the consumer products that we build.”

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