Welland, Ont. Commits To Wood Construction In Drive For Sustainability

As part of its commitment to sustainability, the City of Welland, Ont. has embraced the use of timber in a big way in the construction of two emergency services buildings not normally associated with wood.

The buildings are the Welland Fire and Emergency Services Headquarters and Fire Station # 2.

“This was the time to do it (the projects) as our existing stations were well past their time,” says Welland Mayor Frank Campion, explaining upgraded services are needed to meet the demand of a growing city.

Rising on the remediated site of an old streel plant at 400 East Main St. E., the new energy efficient fire and emergency service headquarters uses exterior structural insulated panel (SIP) walls with glulam beams and columns as the primary structural support for the four-bay apparatus bay and the administration wing, and prefabricated light wood frame trusses as the secondary support.

Being built right behind the current headquarters—which will eventually be demolished—at 636 King Street East, the new Fire Station # 2 features a steel-frame apparatus bay, but with prefabricated light frame wood trusses supported by structural insulated panels. The exterior wall cladding is metal panels.

Site remediation began in January 2021, with concurrent construction starting the following April.

The projects were designed and are being delivered under an Integrated Lean Design and Construction project system. METTKO is the project integrator and constructor and it is using, for the most part, the same team of consultants on both projects.

This includes Moses Structural Engineers, Quasar Consulting Group, the mechanical and electrical consultant, and civil engineer consultant MGM Consulting Inc.

However, there are two different architects. The headquarters building was designed by DPAI Architecture Inc., while Kearns Mancini Architects is the architect of Fire Station # 2.

“This (the two architects) was to give the city maximum creativity,” says Mettko senior consultant Mo Ettehadieh on the reasons for the two architects.

Design work started in the fall of 2019, was briefly derailed with the outbreak of the COVID epidemic in March 2020, but then got back on track, says Ettehadieh.

Under Lean Integrated Project Delivery, a collaborative approach among all the partners, there is a principle titled Design by Alternatives and that’s what drove the design process, he says.

“We were looking concurrently at a range of possible building materials and systems and ultimately wood was chosen as prime material. It was the most advantageous to the client,” says Ettehadieh, explaining that analysis also included all the buildings’ components such as the windows and mechanical systems.

About June or July of 2021, lumber prices started to dramatically escalate and that was the catalyst for a “sudden study” which validated the use of wood, he says. “Steel prices were also going up, but even more so.”

A major driver in the selection of the wood was the City of Welland objective to exceed National Building Code energy efficient standards by 40 per cent, he says.

The two projects are expressions of the city’s commitment to sustainability and revitalization, especially in the case of the fire and emergency service headquarters, as it is located in the downtown core. A major remediation of the old steel plant property was required because the plant owner had only demolished the above ground steel sections.

“There was plenty of rubble on the site and buried below the surface.”

As part of the remediation, Mettko crushed the old concrete pieces into Granular B gravel which will be used on the property. Most of the other material was also recycled and, to reduce offsite trucking costs, the impacted soil was encapsulated within a berm, which will eventually be landscaped with natural materials by Niagara College.

A similar, although much smaller remediation was conducted on Fire Station # 2 site, as it was once the location of a swimming pool which later closed and filled with rubble, says Ettehadieh.

Although fire stations are traditionally brick structures, the city selected wood as a prime material after a careful evaluation, says Fire Chief Adam Eckhart

Both buildings are scheduled for completion by this July and, once that happens, the Welland fire and emergency services department will relocate to its new location will be used to consolidate three existing fire stations.

“It will be quite an attractive building,” says the fire chief, explaining that wood in the apparatus building will be illuminated at night.

An RFP for the design and construction of, what will be Welland’s third new fire station, has been issued, says Eckhart.

Source Daily Commercial News. Click here to read a full story

‘When All Of This Is Said And Done, 80 Per Cent Of Durham Region Remains Green’ — Durham Council Approves Plan To Develop 9,300 Acres Of Farmland

After a decision by council that goes against expert advice, Durham Region will shift gears and plan to urbanize thousands more acres of farmland than what staff had recommended.

“Despite warnings from Durham Region’s own staff and advisory committees, Regional Council has endorsed a developer-recommended growth scenario to urbanize more than 9,000 acres of farmland,” Mayor Shaun Collier said in a statement following the May 25 council meeting that lasted 10 hours.

Durham Region is undergoing a municipal comprehensive review to address growth targets handed down by the provincial government: 1.3 million people and 460,000 jobs by 2051.

As part of the exercise, staff provided different land needs scenarios and recommended one to the planning and economic development committee earlier in May. However, the committee went in a different direction and at the May 25 meeting, council endorsed, in a recorded vote of 16 in favour and 11 against, Scenario 2A, which includes 9,300 acres of farmland development.

Staff had recommended Scenario 4, which includes 2,348 acres of new land for housing and 3,338 acres for employment. It also had called for a unit mix consisting of 28 per cent low-density units, 28 per cent medium density and 41 per cent high density.

Instead, the approved scenario calls for 33 per cent low-density units, 38 per cent medium density and 29 per cent high density.

The day before the May 25 meeting, commissioner of planning and economic development Brian Bridgeman sent councillors a supplemental report outlining his concerns with 2A.

These include: it overstates the land need; it detracts from the achievement of regional sustainability policies and obligations; and it de-emphasizes regional priorities to focus growth in existing communities, where services and infrastructure are either already in place or can be provided more efficiently.

Ultimately, Bridgeman recommended “that council revise committee’s recommendation to support staff’s recommendation of Community Area Alternative Scenario 4.”

Whitby Coun. Steve Yamada said he did not appreciate the late memo, and noted lands that will be expanded are within the whitebelt, which he described as a “future urban area.”

When he questioned the legality of the direction council chose to go following some comments made at the meeting, director of legal services Jason Hunt indicated Scenario 2A is not necessarily illegal, but there is concern that “it may not conform with the province’s expectations under the ‘growth plan.’”

He said Scenario 4 conforms with the growth plan and would survive any scrutiny or challenge from the province.

Pickering Mayor Dave Ryan said, “When all of this is said and done, 80 per cent of Durham Region remains green.”

He said Durham is vibrant and people want to move there, and there must be a range of housing options available from high rises to ground-level homes. 

A number of residents spoke against 2A at the meeting — many asking for no urban boundary expansion — as well as local groups.

Stop Sprawl Durham made its opinion on the decision clear in a Facebook post after the decision.

“Ignored staff, community stakeholders, regional advisory committees and the #ClimateEmergencyDeclaration,” the post said. “It’s a sad day for #DurhamRegion and the #EnvisionDurham work.”

The post also lays out who voted for which scenario.

Collier shared his concerns how this new plan could impact an area of land that’s been a big topic of discussion this year.

“This short-sighted decision makes the urbanization of the Carruthers Creek headwaters not only possible, but likely,” he said. “Leapfrogging the Greenbelt to develop a community of 60,000 people in northeast Pickering greatly increases the risk of downstream flooding in Ajax. To date, developers have proposed only the minimum measures to mitigate the negative impacts.”

Source Storeys. Click here to read a full story

RE/MAX Canada Says Demand For Industrial, Multi-Unit Residential And Farmland Was Unprecedented In The First Quarter Of 2022

Stock markets might be tumbling and housing markets cooling, but this volatility is driving interest in Canadian commercial real estate as investors look for a hedge against inflation, a new report by a major broker says this morning.

RE/MAX Canada says demand for industrial, multi-unit residential and farmland was unprecedented in the first quarter of 2022. Values hit record levels and even retail and office space, devastated by the pandemic, are beginning to show signs of growth.

Eleven out of the 12 major markets studied reported extremely tight market conditions for industrial real estate in the first quarter.

So tight that realtors are recommending tenants start looking for new premises at least 18 months before their leases come up in eight of those markets — Vancouver, Edmonton, Calgary, Winnipeg, Ottawa, the Greater Toronto Area, Hamilton-Burlington-Niagara and London.

“The overall strength of the Canadian economy continues to propel massive expansion in commercial markets across the country in 2022,” said Christopher Alexander, president of RE/MAX Canada.

“What began as heightened demand for industrial space to accommodate a growing e-commerce platform during the pandemic has blossomed into a full-blown distribution and logistics network that encompasses millions of square feet in markets across the country. Recent volatility in the stock markets has also prompted a shift to greater investment in the commercial segment as investors look to real estate as a hedge against inflation.”

Larger portfolios of 10 properties or more are attracting the most interest from institutional and private investors, said RE/MAX.

Businesses are finding it challenging to expand because of land constraints and shortages, especially in Vancouver, the GTA and Regina, and this is leading to creative solutions, says the report.

In Metro Vancouver, the first multi-storey industrial/commercial space is nearing completion and has been leased to Amazon. A second such development planned for False Creek Flats has already sold out its first and second phase and a third phase is selling at $725 per square foot, said the broker.

Farmland is another hot commodity as inventories shrink and prices per acre rise. In Saskatoon, where 300 grain farms up for sale is typical at this time of year, available properties have dropped to 90.

“The soaring price of commodities has bolstered Western Canadian markets, with resource-rich provinces such as Saskatchewan, Alberta, and Manitoba experiencing unprecedented growth as industries emerge from their slumber,” said Elton Ash, executive vice-president, RE/MAX Canada.

“Saskatchewan, in particular, is reinvigorated, with the economic engine just heating up in agriculture, mining, forestry, and potash.”

Retail is on the rebound in 75% of the markets studied, said RE/MAX, a trend it expects will strengthen as society moves beyond pandemic constraints.

Interesting side note on retail: the broker has noticed a high concentration of cannabis outlets in major city centres (who hasn’t?) and expects an influx of empty stores to come on the market over the next 12 to 18 months as that industry consolidates.

RE/MAX expects commercial real estate markets in Canada to remain strong, supported by population growth and economic expansion.

Despite all the uncertainty out there these days, RBC economists expect Canada’s GDP to climb 4.3% this year, led by B.C., Saskatchewan and Alberta.

Source Financial Post. Click here to read a full story

The GTA’s Industrial Real Estate Sector, With A 0.9% Vacancy Rate, Is One Of The Tightest Markets In North America

Analysis from Avison Young notes the region’s vacancy rate has been sideways since the last quarter of 2021, but has declined rapidly over the short term, coming in at 7.1% as early as Q1-2010, signifying voracious appetite from industrial tenants. Logistics and distribution firms, in particular, have been the largest occupants of industrial spaces with at least 10,000 sq. ft — according to the report, 31% of users over the past five quarters are in the sector, followed by 20% in manufacturing, and 18% in retail and e-commerce. Unsurprisingly, investors have been especially active in the sector, 51% of which are private, while 20% are institutional, and 17% are owner-occupiers.

Industrial Rents on the Rise Due to Tight Supply

Avison Young noted that severely constricted supply relative to elevated demand caused rents to increase by 16% to $13.65 per sq. ft in Q1 from the fourth quarter of last year. That growth, while significant, is nothing compared to rents rising by 104% during the last five years alone, the report said. Rents are also offsetting high land costs.

In Q1, there were 11 new building completions, totalling 1.8M sq. ft, while 16M more across 76 buildings was under construction at the conclusion of the quarter, of which 48% is pre-leased. However, the new construction only comprises 1.8% of the GTA’s total industrial stock. There are also 145 buildings comprising 51M sq. ft of industrial space in pre-construction across the metro region, with 63% concentrated in the GTA West.

Toronto is the GTA’s Most Coveted Destination

Rents in Toronto averaged $16.46 per sq. ft last quarter, the highest in the Central GTA, while Scarborough, despite having a 0.4% vacancy rate, had the most tenant-friendly rents at $10.55 per sq. ft. On a quarterly basis, vacancy in the Central market was flat at 0.8% in Q1, however, compared to the first quarter of 2021 it declined by 80 basis points. Etobicoke’s vacancy rate was slightly higher at 1.3% last quarter.

The Central GTA’s average asking net rental rate rose to $13.02 per sq. ft in Q1, surging by 40% year-over-year, by 76% over the last three years, and by an astounding 141% over the last five years.

Although there were no new completions in the Central GTA last quarter, 15 buildings carrying 2.8M sq. ft are under construction, 39% of which is already leased. Fifty-eight percent of the Central market’s new construction is located in Etobicoke and 37% is in Scarborough, while just 5% is in North York.

GTA East Has Low Vacancy, Cheaper Rent

The eastern portion of the GTA had a vacancy rate of 0.5% in Q1, down 10 basis points from the previous quarter, as rent rose to $10.96 per sq. ft, a 48% year-over-year increase — rents have also grown by 97% in the last half decade. Avison Young’s report said the GTA East has among the region’s cheapest industrial rents.

The industrial market is growing in the GTA East, with two major companies, FGB Brands and HiTech Bay, moving in. The former, which just bought Weston Foods, will be acquiring 149 acres of a manufacturing campus and will create 1,200 new jobs, while the latter is moving to Pickering’s Innovation Corridor from Scarborough.

Availability in GTA North Tightens

The vacancy rate declined by 10 basis points to 0.6% in Q1, as the GTA North continues commanding the region’s highest industrial. At $14.24 per sq. ft, the average asking net rental rate is 4.4% above the GTA average, as it increased by 26% year over year and by 107% in the last five years. Rents range from an average of $12.89 per sq. ft in Aurora to $15.79 per sq. ft in Richmond Hill, Avison Young reported.

Three buildings with about 193,200 sq. ft were completed last quarter, while 22 more comprising 4.1M sq. ft were under construction at the beginning of Q2. Thirty more buildings, which will eventually provide nearly 10M sq. ft of additional space, were also in pre-construction. A massive 1M sq. ft logistics and distribution centre is also being built at Highway 404 and East Gwillimbury.

GTA West Vacancy Rate Fell to 1% in Q1

Availability dropped by 10 basis points from the fourth quarter of last year and by 0.60% from Q1-2021. The average asking net rent in the GTA West increased by 43% year over year to $13.85 per sq. ft — which is 105% higher than it was in Q1-2017.

There were eight building deliveries during the first quarter, which provided the market with 1.7M sq. ft of new space, including a 457,000 sq. ft distribution centre in Milton. Moreover, of 7.4M sq. ft across 31 buildings under construction last quarter, of which 3M sq. ft is in Mississauga, 47% is pre-leased.

The Avison Young report also said Bolton has become a popular destination for industrial users, prompting Oxford Properties to invest $210M in a 65-acre industrial property in Caledon.

GTA Industrial Investment Declined in Q1

Although there was still $1.6B of investment in the GTA in Q1, it declined by 30% quarter over quarter. Despite the decrease, activity was still frenetic, increasing by 10% year over year, thanks to robust leasing market fundamentals. While investor activity in the industrial sector doesn’t appear to be waning, they nevertheless began putting their money in other asset classes last quarter.

There was $538M of industrial sales in the City of Toronto last quarter, followed by Peel Region with $449M. The average cap rate for single-tenant properties was flat on a quarterly basis at 3.8%, but decreased by 0.30% from Q1-2021, while multi-tenant property cap rates, at 4%, saw no change from Q4-2021 but dropped by 30 basis points year over year.

Source Storeys. Click here to read a full story

Malls Are Increasingly Becoming Mixed-Use Spaces

Reports of a “retail apocalypse” don’t tell the whole story about what’s happening in Canadian shopping malls. The truth is more complex, with wins and losses leading to a revolution in retail.

Malls were already feeling the pressure before the pandemic. Foot traffic among Canada’s top shopping complexes was down 22 per cent in 2019 compared to 2018, according to Deloitte’s report, The Future of the Mall. Developers and owners were already aware that changes were necessary as more Canadians bought goods online. The pandemic has highlighted the urgency for change, and carefully laid-out five-year plans have turned into planning strategies for the here and now.

“The retail apocalypse is a myth, as were predictions about the death of the mall,” says Michael LeBlanc, senior retail advisor, Retail Council of Canada, and producer/host of The Voice of Retail podcast. “But there’s no question that there’s tremendous transformation happening.”

Large spaces are being divided up into smaller stores, or food destinations, or repurposed into condominiums— Michael LeBlanc, senior retail advisor, Retail Council of Canada

While e-commerce has been a catalyst for change, it hasn’t meant the end of retail stores.

Customers are using malls for curbside pickups and inspirational window shopping to get ideas about what they want to buy online. And more online retailers could be opening return centres in retail complexes to make it more convenient for customers to send back merchandise. “What we are seeing now is harmonized retail,” Mr. LeBlanc notes. “The connection between e-commerce and physical stores is a very intimate one.”

This hybrid model with a blurring of the line between online and in-store experiences is being adopted by what Mr. LeBlanc calls “digitally native vertical brands,” which had previously been living only on the web. Examples include Warby Parker, a retailer of prescription glasses and contact lenses that now has more than 160 physical stores across Canada and the United States, and Allbirds, a maker of sustainable shoes and clothing. He says some of those players are doing IPOs to raise capital so they can create brick-and-mortar retail locations.

Product tests at pop-up stores

For some retailers, having a store gives them visibility and prestige as brands seek to be where the action is with throngs of shoppers buying, browsing and dining in a trendy environment – such as Toronto’s Yorkdale Shopping Centre, one of North America’s most successful malls. It’s not uncommon for the mall’s parking lot to be jammed to the max (prompting a valet parking service) and for customers to be lined up outside of high-profile retailers such as Chanel.

Pop-up stores have become more popular in malls as retailers test out concepts before rolling them out on a large scale. In September, 2021, Zellers, which largely disappeared from the retail landscape in 2013, returned for a limited time inside a Hudson’s Bay in the GTA’s Burlington Centre.

The company hinted more pop-up shops could be opened in the future. At Square One Shopping Centre in Mississauga, a special three-day pop-up market stocked with everything needed for Ramadan shows that mall owners are willing to be more flexible about leasing and offer shorter-term rentals.

Then there’s the Swedish furniture and homewares retail giant IKEA, which has always had its own sprawling, stand-alone stores. The company recently turned a British shopping complex with a 25-per-cent vacancy rate into its new Livat concept. Located in the former King’s Mall in Hammersmith, West London, Livat (which means “lively happening” in Swedish) features a smaller-format IKEA store (about one-quarter of the size of its usual footprint) that has 1,800 items available for purchase and another 4,000 on display to be ordered in-store for delivery or bought later online. Next, IKEA has set its sights on downtown Toronto and San Francisco as it expands this concept into other markets.

Some car companies have opted to open showrooms in malls to take advantage of the foot traffic. Up until recently, Tesla had “galleries” in a number of Canadian shopping centres meant for browsing and ogling. And last year, Toyota opened a full-service dealership in the West Edmonton Mall, occupying the space left vacant by Sears.

Mixed-use properties

Necessity is the mother of reinvention in the mall world. “They were just too big,” Mr. LeBlanc says. “Very few retailers can take on that kind of physical footprint any more. Those large spaces are being divided up into smaller stores, or food destinations, or repurposed into condominiums.”

As more people adopt a hybrid work model, the live-work-play lifestyle trend is taking off as they seek easy access to shopping, services and entertainment close by. Malls are benefiting when they create living spaces for the same customers that will support retailers on the premises.

The concept of “de-malling” has been catching on: taking boxed-in retail complexes and reinventing the rules. That has meant adding green spaces, putting stores outdoors, making them pedestrian-friendly, creating mini streetscapes and generally throwing out the rule book about what constitutes a mall.

David Ian Gray, a retail consultant, strategist and principal of DIG360 Consulting Ltd., based in Vancouver, says the trend around 2010 was for retailers to be in large-scale power centres.

“Shoppers liked that they were one-stop shops, but they didn’t really enjoy the experience of these cavernous places,” he explains. “They tolerated them, but it was the accountants that caused the trend to wane. Those big-box formats required a large inventory of stock, a significant number of staff and the space was expensive to lease. There came the realization that physical retail as we knew it just wasn’t working and things had to change.”

Malls are increasingly becoming mixed-use spaces. Mr. Gray points to Brentwood Town Centre (rebranded as The Amazing Brentwood) in Burnaby, B.C., as one that has made the transition well. Once a typical cookie-cutter mall, it began a major renovation in 2014 to become a curated “master-planned neighbourhood,” with retail space, offices, a fitness centre, movie theatre, medical centre and three residential high-rise towers, plus a food court focused on local West Coast cuisine. “What we’re headed to is a very hybridized integrated world,” he says.

One thing is clear. Malls aren’t disappearing from the retail landscape any time soon. They will just look and feel different. “Shopping malls matter, but how they function and bring people in just got harder,” Mr. LeBlanc says. “It will be very interesting days ahead. Mall owners are smart, innovative people, so I’m excited to see what happens next.”

Source The Globe And Mail. Click here to read a full story

MBA Reports Nearly 75 Percent Jump for Q1 2022 Commercial Borrowing

Commercial and multifamily mortgage loan originations increased 72% in the first quarter of 2022 compared to the same period last year, according to the Mortgage Bankers Association’s (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations. In line with seasonality trends, originations during the first three months of 2022 year were 39% lower than the fourth quarter of 2021. “The strong momentum in commercial and multifamily borrowing and lending at the end of 2021 carried into the first quarter,” comments Jamie Woodwell, MBA’s vice president of commercial real estate research. “The continued growth in lending activity is the result of the ongoing strong demand for certain property types like industrial and multifamily, as well as renewed interest in other property types that saw more dramatic declines during the early stages of the pandemic, such as hotel and retail.”

“It’s likely that the rise in interest rates will take some wind out of the sails of borrowing in upcoming quarters, but strong market fundamentals, property values and investor interest should continue to support the market,” Woodwell continues.

Compared to a year earlier, a rise in originations for hotel, industrial, and retail properties led the overall increase in commercial/multifamily lending volumes. By property type, hotels increased by 359%, industrial increased by 145%, retail increased by 88%, health care properties increased by 81%, multifamily increase by 57% and office increased 30%.

Among investor types, the dollar volume of loans originated for depositories increased by 194% year-over-year. Life insurance company portfolios increased 81%, investor-driven lenders increased 77%, Commercial Mortgage-Backed Securities (CMBS) increased 56%, and Government Sponsored Enterprises (GSEs – Fannie Mae and Freddie Mac) increased 1%.

As is typical in the first quarter, originations decreased in comparison to the prior year’s fourth quarter, with total activity falling 39%. Among property types, declines were seen in office (48%), multifamily (41%), hotel (38%), retail (32%), and industrial (29%). Health care properties increased 17%.

Among investor types, the dollar volume of loans for CMBS decreased 61%, loans for depositories decreased 41%, originations for GSEs decreased 39%, investor-driven lenders decreased 30% and life insurance company loans decreased 23%.

Source Mortgageorb. Click here to read a full story

NWRE, First Gulf Plan More Industrial Condos In Ontario

A partnership between Nicola Wealth Real Estate (NWRE) and First Gulf continues to acquire more Ontario industrial properties, the latest being a 13.4-acre site in Oakville, west of Toronto.

The vacant and unimproved site at 574-576 Bronte Rd. — immediately south of Hwy. 403, on the west side of Bronte Road at the intersection with Speers Road — was purchased from Suncor Energy for approximately $8.5 million.

First Gulf was contracted to acquire the property and brought in NWRE as a partner.

“We’ve done many projects with First Gulf,” NWRE director of acquisitions Alex Messina told RENX. “They’re a trusted and valued partner, and very skilled at industrial development.”

NWRE also partnered with PC Urban Properties to acquire a 3.4-acre property at 2660 Barnet Highway in Coquitlam, B.C., where it plans another strata industrial project. The property is just west of the Coquitlam Town Centre, at the edge of Greater Vancouver.

The price was not disclosed.

At this site, NWRE and PC Urban plan to develop two buildings totalling about 100,000 square feet. 

Industrial condominium expansion plans

Vancouver-based NWRE has been involved with about 20 industrial condominium projects in its hometown and in Kelowna and Victoria.

It wants to add to that total in the Greater Toronto Area (GTA) and Montreal through multiple small-bay buildings with units ranging in size from approximately 2,000 to 5,000 square feet.

“It’s very difficult for users that require that size of industrial space to go and buy a freestanding building,” Messina explained. “At the same time, those same users have seen lease rates escalate significantly.

“We know there’s good demand from both building owners and investors. There’s good liquidity to these units. These types of buyers and business owners are typically entrepreneurs, so they’re very comfortable with the idea of owning their own real estate.”

Industrial space in the target size range is often older and there isn’t much new product available to lease. So, condos seem destined to catch on in Ontario the way they have in British Columbia as both users and investors become more accustomed to them.

“When you look at the economics of building this product, you can sell it for more on a per-square-foot basis than you could derive if you built it and leased it, or sold it in a block to a large investor like ourselves,” Messina said. “There’s an economic opportunity for developers to capitalize on this.”

NWRE has a number of other holdings in Oakville and Messina believes the wealthy city is particularly well-suited for industrial condos.

“Typically, business owners want to have their space close to where they live. We’ve had good success in picking locations that are close to where business owners and decision-makers live, which is typically in more affluent areas.”

NWRE and First Gulf

NWRE is the in-house real estate arm of Nicola Wealth, a financial planning and investment firm with $12.1 billion in assets under management.

NWRE manages a growing portfolio in major markets across North America, spanning the industrial, multiresidential rental apartment, office, self-storage, retail and seniors housing asset classes.

Its portfolio exceeds $8 billion in gross asset value after completing approximately $1.9 billion in acquisitions during 2021.

NWRE’s growth is being concentrated in the GTA, Greater Vancouver, Winnipeg, Vancouver Island and B.C.’s Okanagan region. It’s expanding into Ottawa and Montreal, with a focus on acquiring income-producing properties and value-add opportunities.

Toronto-headquartered First Gulf is a fully integrated development company that has developed more than 30 million square feet of office, industrial, mixed-use and retail properties worth more than $4 billion since its inception in 1987.

First Gulf is part of Great Gulf Group, which was established in 1975 and has major projects in Canada and the U.S.

Other NWRE and First Gulf acquisitions

NWRE and First Gulf have collaborated on several other projects in the GTA, including a large development property immediately across Bronte Road called Bronte Station Business Park that’s in the pre-leasing stage.

The partners expect to deliver buildings of 290,000 and 76,000 square feet for occupancy in Q4 2023.

A 77,000-square-foot industrial building in the southwest corner of Bronte Station Business Park is currently leased to Mancor Industries.

NWRE and First Gulf are working through the site-plan application approval process for 50 acres of industrial land at 10538 Coleraine Dr. in Brampton, where they’re looking to build multiple buildings totalling about 350,000 square feet.

The companies acquired a recently completed industrial development at 880 Avonhead Rd. in Mississauga that’s leased to Amazon.

Last year they acquired a 52-acre property on Allendale Road between Riverbank Drive and Hwy. 17 in Cambridge that offers quick access to Hwy. 401. The plan is to construct buildings of 157,000, 194,000, 275,000 and 330,000 square feet, valued at approximately $200 million upon completion.

The two partners acquired a nine-building, 473,000-square-foot industrial portfolio in Burlington, Hamilton and Stoney Creek near the Queen Elizabeth Way, but have already sold eight of them.

They’ve retained a property at 850 Legion Rd. in Burlington that had an existing leased industrial building which has now been converted to industrial condos.

“Part of the strategy was to acquire in bulk and resell the pieces as part of our merchant strategy,” Messina said. “There’s been really strong demand for industrial properties, so we’ve been able to execute on that strategy faster than anticipated.”

More NWRE Ontario industrial acquisitions

Other recent NWRE GTA and Greater Golden Horseshoe industrial acquisitions include a 20.84-acre property at 601-607 Milner Ave. in Scarborough with an existing 440,000-square-foot, two-storey building.

First Gulf is the general contractor for the project, which involves demolishing the current building and replacing it with a 350,000-square-foot distribution centre with 40-foot clear heights that should be completed in early 2024.

Pre-leasing has begun for the property, which was acquired in April 2021 and has good exposure to Hwy. 401.

NWRE acquired an 87,000-square-foot industrial plant on an 8.1-acre site at 2491 Royal Windsor Dr. in Oakville that’s currently leased on a long-term basis to Mancor.

“Our strategy is comprised of both acquiring existing income-producing properties and development sites,” Messina said. “Some we’ll retain long-term and others have natural exits, like industrial condos.”

NWRE acquired Blackwood Partners on Jan. 1, 2021, but has allowed it some autonomy.

In July the two acquired a 35-acre site at Kelson Avenue and South Service Road in Grimsby that fronts the Queen Elizabeth Way. There are plans to build more than 700,000 square feet of distribution space in two buildings.

NWRE and Blackwood also purchased 105 acres of industrial land in King Township in January 2021, where there are plans to build up to 1.8 million square feet.

The partners are working on site plan applications for the Grimsby and King Township properties.

Northbridge and Hopewell partnerships

NWRE and Northbridge acquired a 16-acre site on York Mills Road in Toronto where they’re working on pre-leasing strategies for a planned ground-up development with multiple buildings for last-mile distribution.

The two companies also partnered on a five-acre site at 7242 Hwy. 27 in Vaughan near the Hwy. 407 interchange. An old motel is being replaced by 88,000 square feet of industrial condo units.

NWRE and Hopewell Development acquired 51 acres of industrial land at 9555 Airport Rd. in Hamilton for $36 million in February that they’re working to entitle, with a goal of erecting three buildings comprising 750,000 square feet.

The two partners also purchased 17 acres of industrial land at 5179 North Service Rd. in Burlington for $44.075 million in February.

They’re working through the site plan application approval process and want to build two industrial buildings of 131,000 and 147,000 square feet to target mid-bay users.

Source Real Estate News EXchange. Click here to read a full story

Mississauga Mall For Sale In Emerging Development Corridor

A Mississauga property which has housed a community shopping centre for over a half century is for sale and could be destined to become the site of a multi-tower, mixed-use redevelopment.

High Point Mall sits on a 4.41-acre property at 3415 and 3461 Dixie Rd. at the corner of Bloor Street.

Institutional Property Advisors, a division of Marcus & Millichap Real Estate Investment Services Canada Inc., is representing the owner. It is being sold by the two families who developed it in the late 1960s.

“It’s an inter-generational disposition,” Institutional Property Advisors senior managing director Scott Chandler told RENX. “The original developers have passed on and their children are selling.”

“High Point Mall was built by immigrants who arrived in Canada without family, language or money,” said a statement from one of the unnamed owners, which was emailed to RENX via Chandler and IPA. “They did have tremendous energy, though, and hoped to become worthy Canadians who would contribute to society.

“The centrally located plaza and office building have morphed over the years, becoming the community hangout for the many demographics that make up Toronto.”

The statement concluded with: “Although the property is likely a development site now, it is our hope that in the future this location will again become a central community hub for the many and diverse peoples who live in the neighbourhood.”

High Point Mall status, future potential

There are 76,555 square feet of existing retail and office space at High Point Mall generating net operating income of $1.02 million annually. The property is 88 per cent occupied.

Grant’s Foodmart, a local grocer, accounts for 30 per cent of the total space and one-third of the current rent. Other retail occupies 37 per cent of the space, an office building comprises 20 per cent and mall office space accounts for 13 per cent. The average remaining lease term is more than three years.

“It has holding income, which is nice,” said Chandler. “You could continue to operate it as a shopping centre and office building complex for a long time while you’re entitling it.”

An initial planning review by Bousfields Inc. estimates 794,000 square feet of gross floor area could be approved in the designated mixed-use location, including 755,000 square feet of residential space.

The proposed concept plan includes five buildings, ranging in height from six to 25 storeys, including 876 residential units. It also includes a 0.59-acre public park and a new public road connecting Dixie Road to Williamsport Drive.

All but 7,719 square feet of the existing tenant spaces have demolition clauses in place, which would facilitate redevelopment.

High Point Mall’s location in East Mississauga borders Etobicoke in the Applewood neighbourhood, an established and amenities-rich area of schools, golf courses, parks and recreation trails.

It’s about a 10-minute drive from CF Sherway Gardens and Square One Shopping Centre.

The property isn’t far from the Dixie or Kipling GO Transit stations.

Chandler expects plenty of interest in the property from private, institutional and publicly traded developers. The bid date deadline is 3 p.m. on May 31.

Mississauga high-rise development

There were more than 3,900 high-rise unit sales in Mississauga in 2021, a 43 per cent increase from 2020. The average sale price per square foot has more than doubled since 2015 and reached a record $1,125 in February.

“We’re starting to see a natural expansion of the core market to include Mississauga and other 905 regions as the GTA continues to grow,” said Chandler.

“Especially with work from home, it’s becoming a very viable market to locate and buy your home versus the 416, especially where there are already existing amenities and infrastructure.”

There are more than 18,000 units in active high-rise apartment development applications in Mississauga, including more than 1,300 planned rental units.

While Mississauga City Centre and the Lakeshore Road area have attracted some of this growth, it has now spread across the city, including the Dixie Road corridor.

“We sold a large parcel at Dixie and Derry last year,” said Chandler. “Dixie Outlet Mall has been going through a lot of entitlement to the south of this property.

“It’s a nice central corridor where we see intensification starting to happen.”

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Vaughan Ind. Building Becomes Coveted Life Sciences Space

Life sciences space is hard to come by in the Greater Toronto Area (GTA), but a newly renovated 25,000-square-foot building is now available to lease in Vaughan.

The former manufacturing and warehousing building at 196 Citation Dr. is near the intersection of Langstaff Road and Dufferin Street, not far from major highways, the Toronto Transit Commission Vaughan Metropolitan Centre subway station, and dining, shopping and leisure amenities.

It has been retrofitted with about $10 million in specialized improvements since last year by its longtime private owner in order to become a 22,000-square-foot facility that meets European Union good manufacturing practice standards. It also includes 3,000 square feet of office space.

“This is a 25,000-square-foot, ready-to-go, brand new life science lab building in a market where there isn’t a single comparable,” Colliers senior vice-president Matthew Johnson, who’s leading the team marketing the property, told RENX.

Leasing interest is picking up

While the owner is looking to lease the property, Johnson said it could be made available for sale if the right offer comes along. There has been strong interest since the property started being marketed late last year, Johnson added.

Renovations have been ongoing during that time and are nearing completion. Johnson said it should be ready for occupancy on July 1.

“We’re coming out of the pandemic here and it’s been interesting in our market to watch the willingness and openness for groups to engage and go view the building,” Johnson said of marketing the property. “One of the realities of the marketplace that we’re talking about is many of the executives and decision-makers related to buildings of this nature are not in Canada.

“Over the past few months, we’ve had a bit of a build-up in demand for groups to cross the border, which is now happening. We have a group coming in from Germany in a couple of weeks. We had a group in from the U.S. a couple of weeks ago.

“Those are all groups that would have been here previously had it not been for border restrictions.”

Life sciences activity in the area

Johnson said there’s pharmaceutical and technology business activity in and around Vaughan. LEO Pharma, which employs 130 people, moved its Canadian office to Steeles Avenue East on Feb. 1. Apotex’s global head office is just south of Vaughan, as is Sanofi Canada’s large and growing campus.

The 196 Citation Dr. building is also in relatively close proximity to York University.

On a wider scale, the site fits in the Southern Ontario life sciences corridor that also includes Hamilton and Kitchener-Waterloo as well as the GTA — especially downtown Toronto’s Discovery District and “Pill Hill” in Mississauga’s Meadowvale area.

The corridor contains the largest life sciences community in Canada and one of the largest clusters of biotech, medtech, health tech and life sciences companies in North America.

According to Toronto Global, the city has more than 11,000 researchers and technicians working at 37 research institutes, nine teaching hospitals and the University of Toronto’s Faculty of Medicine.

Life sciences space is scarce

One of the reasons why life sciences space is so scarce in the GTA is that, at least until the pandemic, it had an extremely low office vacancy rate. Landlords didn’t feel obligated to build or retrofit more expensive specialized lab space if they knew they could easily lease to more traditional office tenants.

“Wet lab inventory in this market is ridiculously low, frankly, in comparison to major markets around the world,” said Johnson, who pointed out that Boston already has significantly more life sciences space than Toronto and has more under development.

There’s lots of talent available now, and more coming from universities and immigration, and venture capital funding from Canadian and American sources is on the rise. Government funding is also increasing in the life sciences sector. It’s just a matter of finding real estate for these people to work at and for the money to be invested in.

Toronto has about 15 million square feet of life sciences space, according to Johnson, and he said about 40 per cent of that is user-owned. User-owners represent 15 to 25 per cent of the market in large life sciences hubs like Boston and San Francisco, Johnson pointed out.

“They have more inventory, but also more of it available.”

New Toronto life sciences facilities coming

Sanofi and the federal and provincial governments announced in March 2021 that a $925-million investment would be made in a vaccination manufacturing facility at its North York site. The new facility is expected to create more than 1,200 jobs and be up and running in 2027.

The University of Toronto’s Schwartz Reisman Innovation Centre is under construction in the Discovery District. When completed it will provide a 12-storey, 250,000-square-foot building that will focus on artificial intelligence and innovation and a 20-storey, 500,000-square-foot tower that will provide space for biomedical innovation.

A KingSett Capital-owned, 20-storey, 1.22-million-square-foot building at 700 University Ave. in the Discovery District will add four storeys dedicated to high-performance life sciences research space that will encompass 187,000 square feet.

“There are a ton of groups, local and non-local, that are looking to invest, develop, retrofit or otherwise create space for wet lab use in the region right now,” said Johnson, who expects announcements to be made in the coming months.

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The Well Is Taking Shape, And Leasing-Up Retail Tenants

Construction and leasing are both progressing well at The Well, a 7.8-acre mixed-use residential, office and retail site which is one of the most prominent ongoing developments in downtown Toronto.

When completed next spring after a construction period that began in 2017, The Well will provide 1.5 million square feet of residential space with approximately 1,700 condominium and purpose-built rental units, 1.2 million square feet of office space, and 320,000 square feet of retail space in seven mixed-use towers and mid-rise buildings, as well as park and public spaces.

RioCan REIT acquired the site between Front Street West and Wellington Street west of Spadina Avenue in 2012, along with Allied Properties REIT and DiamondCorp (which sold its 20 per cent interest to its two partners in 2017). Along with more recent partners, Tridel and Woodbourne Capital Management, the development is well underway and journalists were offered guided tours on May 6.

Major retail leasing announcements were made the same day.

Retail leasing moving forward at The Well

The Well’s retail space is approximately 79 per cent leased, or with tenants in advanced stages of negotiation.

“You can’t really do retail leasing three or four years in advance, but retail leasing is now picking up and we’re really excited about that,” RioCan chief investment officer Andrew Duncan said.

“Tenants we’ve been talking to have seen the project for what the value proposition will be in Toronto, and we’ve been finalizing those deals without issue,” RioCan vice-president of leasing Ashtar Zubair added. “This is not a mall.

“Our intent here, with regards to the merchandising, is to curate to the customers that we consider our residents. There will be 11,000 people living and working here, and we know the services and needs they need.

“We’re not going to go deep on one specific category. We want to curate the centre to effectively be a streetfront controlled by one landlord, so we’ll be able to interchange as needs evolve for customers.”

Arcadia Earth, HealthOne and more

One new tenant at The Well will be Arcadia Earth, an immersive exhibition powered by augmented reality that takes entrants on a multi-sensory journey through Planet Earth by visiting underwater worlds, mystical forests and underground caves. Arcadia Earth is in New York City and Las Vegas and The Well will be the first Canadian location.

HealthOne is a medical and wellness centre that will occupy 15,000 square feet at The Well and offer: family medicine; rehabilitation services such as physiotherapy and osteopathy; dental services; optometry and optical services; mental health support with virtual and in-person psychotherapy; wellness services such as naturopathy; and a full-service skin clinic.

Other finalized retail tenants at The Well include Sweat and Tonic, Oliver & Bonacini, Shoppers Drug Mart, BMO, Scotiabank, Quantum Coffee, Tokyo Smoke, Bailey Nelson, Bone & Biscuit, dentalcorp, Fix Coffee + Bikes, Prince Street Pizza, Lumea Laser Clinic, Maverick, The Village Collective and Vie by Lê.

The site tour included a walk under a 35,000-square-foot canopy comprised of almost 2,000 panes of glass that will provide both shelter from the elements and natural light to an unenclosed retail area. There will be landscaping on all floors under the canopy, bridges will allow people to cross from side to side on the upper levels of the retail component, and open-air alleys will connect the north and south ends of The Well.

“We believe the site is a really good opportunity to transition from Front all the way through to King West,” Duncan said.

Wellington Market at The Well

The Well will also feature Wellington Market, a 70,000-square-foot, fully liquor-licensed food and drink market with indoor and outdoor seating for 900 people. The 4,200-person space will offer local produce, prepared food kiosks, packaged food vendors, artisanal fare and casual dining options day and night. It will include 25,000 square feet of gross leasable area and house approximately 60 vendors.

Confirmed tenants include La Cubana, Hooky’s Fish and Chips, Ren Sushi, Chun Yang Tea, Lobster Burger Bar, Rosie’s Burgers, Isabella’s and Sweetie Pie.

There will be “activation space” embedded into the market to allow for events, concerts, comedy shows and other activities intended to draw people to the location.

Other restaurant concepts at The Well will include an upscale French bistro and a two-level British-inspired tavern.

Parking for 744 vehicles, shipping and loading functions will be below ground, where there will also be storage space and full-service catering operations powered by an Oliver & Bonacini commissary and ghost kitchen.

Office component is progressing well

The tour went up to the 32nd floor of the RioCan and Allied-developed primary office tower that, while still not completed, has begun occupancy. Office space at The Well is 90 per cent leased, with major tenants including Shopify, Index Exchange, Spaces, BDP Quadrangle, Financeit and Konrad.

Almost one million square feet of space is in the primary office tower, with the remainder spread over the lower levels of three other mixed-use buildings.

“We started well before COVID and were lucky enough to be one of the projects that could work all of the way through COVID because we have residential components all the way through,” Duncan said. “We did a lot of good pre-leasing on the office side pre-COVID and that was maintained throughout COVID.”

Office floor plate sizes grow smaller the higher you go in the tower, while an offset elevator core opens up the floor plates.

All heating, ventilation, air conditioning and electrical systems are located under the floors. Heating and cooling throughout the development will be taken care of through a partnership with Enwave’s renewable energy system using water from deep in Lake Ontario.

The Well’s system includes a 7.6-million-litre water tank that acts as a thermal battery to create and store energy at night, leveraging off-peak costs. The green and clean technology will also supply a high-efficiency hot water network to deliver efficient, resilient heating and cooling to The Well and 13 million square feet of space on nearby King Street West.

The tower, which is targeting LEED Platinum certification, will be topped by a 36th-floor restaurant offering 360-degree city views and a mix of seating options and guest experiences, including a luxurious dining room, bar, sushi counter and chef’s rail.

Economic impact and residential components

An economic impact report on The Well by Altus Group concluded annual benefits from the ongoing operation of its commercial and retail spaces, and the management of the property, will generate more than 23,000 person-years of employment and more than $300 million in income by households.

The estimated annual economic benefit from the ongoing operations of The Well will add up to approximately $939 million for Toronto. Once complete, The Well will offer space for 5,000 office jobs, 1,200 retail jobs, and 1,700 residences split between three condos and three purpose-built rental apartments.

RioCan Living and Woodbourne’s 46-storey FourFifty The Well will have 592 residential rental suites. Woodbourne also owns two mid-rise rental apartment buildings on Wellington Street that will have more than 300 units.

Ninety per cent of The Well’s condo component, representing more than 650 units, has been sold by Tridel.

Tridel at The Well – Signature Series is a luxury 14-storey, 98-unit building fronting Wellington Street. Prices started at $2.1 million and suite sizes range from 1,468 to 3,259 square feet.

Tridel at The Well – Classic Series I is a 38-storey condo with limited suite availability, while Classic Series II has 258 suites of up to 1,800 square feet.

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