Apartment construction bolsters July housing starts

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

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

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

Cities at a glance:

Vancouver

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

Victoria

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

Lethbridge

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

Regina

Total housing starts in Regina trended lower in July after the pace of single-detached and multi-family construction slowed from the previous month. In 2019, builders have initiated just over a third of the total units started over the same period in 2018. This is largely due to higher construction costs and weaker economic conditions that have moderated new home demand and caused some projects to either be shelved or cancelled altogether.

Winnipeg

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

Toronto

Total housing starts trended lower in July in the Toronto CMA, primarily driven by lower multi-unit starts (semi-detached, rows, and apartments). Pre-construction sales of multi-unit homes, particularly condominium apartments, have been strong for the last few years and will break ground at a varying pace throughout the year. Strong demand for relatively affordable higher density housing continues to persist among homebuyers in Toronto.

St. Catharines

In July 2019, the total housing starts trend in the St. Catharines CMA inched lower. The total housing starts trend in recent months remained close to a 30-year high with townhomes accounting for the largest share. Improvements in employment conditions for people aged 25-44 fueled first-time home buying activity in relatively affordable home types such as townhomes.

Ottawa

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

Montréal

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

Saguenay

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

New Brunswick

In New Brunswick, year-to-date total housing starts are up 40 per cent compared to last year. The increase largely reflects unprecedented levels of rental apartment construction, particularly in Moncton and Saint John. These two CMAs alone accounted for 75 per cent of all new multi-unit construction in the province. The number of multi-unit starts this year are the highest recorded in the first seven months since 2010. New Brunswick’s urban centres are benefiting from provincial strategies to actively attract and retain immigrants. These new arrivals are boosting rental demand, in addition to demand from an aging population.

Prince Edward Island (PEI)

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

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

NB confers on industrial property assessment

Industrial property assessment will be under scrutiny in New Brunswick during three days of public hearings in early September. A standing committee of the provincial legislative assembly is exploring whether equipment and machinery used in manufacturing and industrial processes should be factored into the assessed value of the property.

Earlier this year, an opposition member of the legislative assembly (MLA) withdrew his private member’s bill seeking that outcome through an amendment to the provincial Assessment Act, but then made a motion for the standing committee on law amendments to study the matter further. The committee has now been tasked with making recommendations on “whether to reduce or eliminate any property assessment or property taxation exemptions or benefits that apply to heavy industry”.

The cited exemptions apply to features and devices related to production processes within industrial facilities, such as equipment, machinery, systems providing power for industrial operations and crude oil storage tanks at refineries. All are commonly exempted from property tax in other jurisdictions throughout North America. However, the MLA’s motion underscores concerns that “public institutions such as hospitals have much higher assessments than many industrial properties”.

Despite the industrial focus, New Brunswick-based property tax consultants with Altus Group maintain that any move to expand the pool of assessable features within a facility will also have cost implications for commercial properties. “The most obvious effect would be higher taxes imposed on many commercial and industrial businesses and their operations,” Rob Newman and Mathieu Maillet concluded in a commentary on the earlier, since rescinded, private member’s bill.

The new impetus via the standing committee occurs within the context of New Brunswick’s minority government. With 22 seats, the governing Conservative Party enjoys a mere one-seat edge over the Liberal opposition’s 21, while the Green Party and People’s Alliance each hold three seats. Notably, both of the smaller parties supported the motion for the public hearings and standing committee report on industrial property assessment.

“These hearings will be of interest as ultimately there could be significant consequences to the taxpayers in New Brunswick,” Newman and colleague Justin Babineau observe.

“I encourage representatives of heavy industry and municipalities, taxation experts and other stakeholders in our province to provide us with input on the current taxation and assessment system as it relates to heavy industry,” says New Brunswick’s Attorney General and Justice Minister Andrea Anderson-Mason, who chairs the standing committee.

Crown Realty buys first property in Ottawa

Crown Realty Partners (Crown) has acquired a 289,000 square foot office complex in Ottawa’s west end. Known as Carling Executive Park – 1525, 1545 and 1565 Carling Avenue – the property is located on a 4.16-acre site.

“We are pleased to acquire our first asset in Ottawa, in an area that will continue to attract tenants across a wide range of industries,” said Emily Hanna, partner, investments at Crown in the press release. “Our repositioning plans are geared to assist companies in attracting top Ottawa talent and making them feel excited to come to work.”

This acquisition was made on behalf of Crown’s fourth value-add fund, Crown Realty IV Limited Partnership (CR IV LP).

Crown will act as an asset manager and has engaged Glenview Management Ltd., the original developer of the site, to oversee the property management. According to the press release, Crown and Glenview will kick off large-scale capital improvements starting this fall including upgrading common areas, introducing a WorkFit by Crown fitness centre, a new tenant conference centre, and a robust model suite program.

Finding an Apartment Just Got Easier

It wasn’t that long ago when the real estate industry operated on ink, paper and handshakes. Renters had to physically meet up with landlords to sign documents, and a deal couldn’t be closed without meeting in person. Looking at rental apartments used to mean physically going to see rental apartments.

Today, 90 per cent of renters search for their apartments online and over 60 per cent of those searches are conducted on mobile devices. Consumers now are self-sufficient, a term Google refers to as ZMOT, or the “Zero Moment of Truth”, meaning that shopping is no longer about physically going to a store, just as renting an apartment no longer requires physically meeting with the landlord. Needless to say, the real estate industry has gone digital and disruptive technologies are bringing about rapid change.

Evolution of Digital Search & Rental Properties

Combine a thriving Canadian economy that’s enjoying a particularly strong tech sector with a record number of immigrants and all-time low vacancy rates, and the result is a very competitive rental market. At the forefront of the competition is technological advancements that have shortened the time required to find rental apartments and close deals.

Renters can now get in direct contact with verified landlords, allowing them to find and secure in-demand apartment rentals faster than ever before. In theory while it’s never been easier to find a rental apartment, the market has never been more competitive.

It’s clear that technology is a driving force behind the real estate market, and RentSeeker.ca is bringing industry leading innovation to the rental sector, while revolutionizing the search experience for Canadian renters across the country.

Putting Renters First

Technology has put power in the hands of the renter, both physically and metaphorically. Physically, renters have more powerful search tools than ever before, all in the palm of their hands. In a matter of minutes, renters can search for apartments for rent in Toronto and elsewhere by quickly setting parameters to narrow down properties by location, price, and other optional amenities.

RentSeeker.ca continues to roll-out new search features on their website to reflect current trends in the digital real estate marketplace, with additional focus on the expansion of mobile search use amongst millennials entering the rental market. Combine this demographic with an aging digital friendly population, and the network of renters searching for apartments online continues to grow year over year.

The transformation to digital-based rental listing platforms and websites continues to provide a huge increase and opportunities for online exposure and building brand awareness for landlords, and new opportunities are also growing for other real estate categories that traditionally didn’t have as much digital representation, including:

Retirement Homes and Senior Living Properties
Student Housing
Short Term Rentals
Furnished Apartment Rentals
And Commercial Properties

The demand for these alternative rental markets has never been stronger, as demonstrated by the incredible popularity of Airbnb. As many smaller cities across the country continue to grow and support more multi-family, student housing, retirement homes and commercial properties, real estate marketing solutions for an all-age Canadian demographic is also growing, providing continued growth in real estate marketing platforms across the country with the increase in market size and competition.

Utilizing Current and New Digital Platforms

Awareness and utilization of currently popular and new websites, apps, and platforms can sometimes be a challenge for real estate owners, property management firms and landlords who are trying to keep up with the ever-evolving world of digital innovation.

With new search features and available average rent prices in Toronto and other cities across Canada, which are updated in real-time, combined with the integration of Facebook Marketplace – RentSeeker.ca offers expanded new opportunities for landlords to increase exposure and directly target millions of qualified and informed renters daily.

Facebook’s Marketplace has been extremely successful and brings together a huge community of online users. An aging population of digital friendly renters are entering the rental market and this trend continues to support a broader transition towards a fully digital rental marketplace. Facebook continues to generate massive revenues and is the most popular social media platform for non-millennials. The ability to quickly share apartment listings on your Timeline and in Messenger is a very powerful tool and is a great way to advertise and promote available apartment rentals across Canada.

Technology Delivers Security: Improved Confirmation Verification

A longstanding problem with the rental industry has been fraud. Many renters across the country have been taken advantage of, and the same can be said for landlords who can share horror stories of problematic tenants. In fact, Global News has a search tag just for stories about rental scams occurring on more popular classifieds.

To combat this issue, RentSeeker.ca recently launched a new trust tool called Verified Listings across its new platform and website. The newly launched feature is designed to increase authenticity and add an additional layer of security for its community of renters and landlords across Canada. The new feature had been in beta testing for a few months, and after receiving positive feedback from users, RentSeeker.ca has now made the new tool a permanent feature in its listing process.

Many of Canada’s largest real estate owners, property management firms and real estate investment trusts (“REITS”) list their rental properties on RentSeeker.ca and this new trust tool will provide renters with another layer of security by providing them with the validation and security of knowing they are renting from a trusted source.

RentSeeker.ca continues to lead the market as one of Canada’s largest, most visited, and most trusted apartment finders, offering the latest features and starting new trends. The company continue to develop and launch additional features and services to help renters make informed and responsible decisions throughout the apartment search experience. After close to 10 years of continued growth in their user base, they continue to expand their website and platform, and plan to keep offering new features and services geared to both renters and landlords providing a best in class user experience.

About RentSeeker.ca

RentSeeker.ca is a privately-owned real estate listing platform with thousands of rental listings across Canada and millions of users utilizing the platform every year. As an award-winning technology and marketing company servicing the real estate industry, RentSeeker.ca has become a leading Canadian web and technology company.

Toronto condo sales hit record high

Toronto marked a record period for condo sales in the second quarter of 2019. This is according to an Urbanation inc. report which states new condominium sales in the Greater Toronto Area (GTA) totaled 8,902 units in Q2-2019, surging 77% year-over-year as 10,848 units were launched for pre-sale during the quarter.

“Sales reached their second-highest Q2 level on record behind the market peak in Q2-2017 (11,413 sales), which followed a muted first quarter of activity and brought total first-half sales of 11,967 units in 2019 above with the 10-year average of 11,205 units,” the report announced. “Units launched during Q2 in the GTA averaged a sold index price of $903 psf [per square foot], while average prices for remaining inventory reached $1,000 psf for the first time, rising 9% year-over-year.”

Urbanation credits the GTA’s robust condo activity to strong fundamentals, including record-low borrowing costs, record-high population inflows, a healthy job market and tight conditions in the resale market, and a significant shift to relatively low-cost projects. Moreover, nearly every condo project launched for pre-sale in Q2-2019 had received planning approval, reducing the risk of cancellations.

The report indicates that projects priced between $800 and $900 psf in the 416 and 905 municipalities sold 69% of their units, representing the strongest segment of the market. Meanwhile, absorption rates fell to 58% for projects launched between $900-$1,000 psf, declining further to the 50% level for projects that opened for more than $1,000 psf, which included four of seven projects selling less than 50%.

Urbanation added, “Projects priced below $1,000 psf have attracted a wave of demand as buyers seek out ‘value sites.’ Pricing for remaining units in the former City of Toronto averaged of $1,291 psf, which compared to $894 psf in the outer 416 municipalities and $740 psf in the 905.”

NKBA releases 2019 market report

The National Kitchen & Bath Association (NKBA) and John Burns Real Estate Consulting have released the 2019 second-quarter Kitchen and Bath Market Index (KBMI) report. With a KBMI of 65.7 and scores above 50 indicating growth, the industry remains strong, demonstrating an optimistic view of sales, which are expected to grow by 4.7 per cent in 2019. The report reveals that increases in consumer spending are being driven primarily by rising material and labor costs, as opposed to customer discretion.

Conducted quarterly, the index gauges the economic pulse of the industry by examining current demand and future expectations in addition to monitoring sentiment among designers, manufacturers, retailers and building/construction firms.

“As the leading trade association and advocate for the kitchen and bath industry, one of NKBA’s goals is to arm our members with market insights, as well as to raise awareness about impactful industry challenges,” said Bill Darcy, NKBA CEO. “Although NKBA members are still optimistic about current and future kitchen and bath business conditions, there are signs of changes in the marketplace that we are monitoring closely.”

The availability of skilled professionals, cost of materials and trade issues top the list of overall challenges for the second consecutive quarter. Lack of skilled workers is the chief concern among building and construction firms, while designers point to a slowing luxury market and shift to lower price points as the biggest barriers to growth. Still, the report shows 57 per cent of customers have increased total spending since 2018.

Designers say higher total project costs and declining consumer confidence are causing consumers to shift to lower price point kitchen and bath products and finishes. Designers report they are offering more lower-price point big-ticket options like cabinets and fixtures to appeal to the increasingly price sensitive consumer.
Building and construction companies cite that the lack of skilled subcontractors in the market is preventing them from doing more projects. Remodeling companies say they are investing in project management software to create efficiencies as availability of trades worsens.
Retail/sales companies say flattening real estate values, economic uncertainty, and higher product costs are negatively impacting clients’ urgency and budgets.
Brick and mortar retailers also report it’s increasingly more difficult to compete with e-tailers , which is causing many of these companies to adopt new business models that enable bundling of more value-added services like design and construction
Manufacturers report increasing labor and material costs are their biggest barriers to increasing capital expenditures. Many express a need to drive operating efficiencies to improve financial position and better compete and invest in their business.

See the full report here: NKBA report

RCMP opens new Surrey laboratory

The RCMP has opened a new state-of-the-art laboratory facility in Surrey, B.C. The new facility, which is targeted to meet LEED Gold environmental standards, will feature advanced telecommunications systems and specialized workstations designed to fulfill lab operating requirements. It replaces the existing 45-year-old Vancouver laboratory.

Each year, the RCMP’s National Forensic Laboratory Services (NFLS) processes thousands of requests from police agencies across the country for forensic services, in areas such as biology (DNA), toxicology, trace evidence, anti-counterfeiting, and firearms and toolmark identification. These services play a vital role in criminal investigations.

The lab is scheduled to be at full operating capacity by the fall of 2019. During the transition period, the NFLS locations in Edmonton and Ottawa will ensure that forensic service requests continue to be processed.

The new lab will allow the RCMP to continue providing critical services to support criminal investigations across Canada, helping to identify, eliminate or exonerate suspects, and enhance public safety.

“Ensuring police agencies across the country have timely access to state-of-the-art forensic laboratory services is a priority for the Government of Canada. Our Government is committed to enhancing public safety, supporting law enforcement, and ensuring that criminals are brought to justice. This new lab facility will ensure that the RCMP can continue providing advanced forensic services to assist with police investigations across Canada,” says Minister of Border Security and Organized Crime Reduction, on behalf of the Honourable Ralph Goodale, Minister of Public Safety and Emergency Preparedness.

CMHC: Canadian housing starts up in July

Canadian housing starts trended positively between June and July 2019. Recent stats from the Canada Mortgage and Housing Corporation (CMHC) indicate housing starts rose from 205,765 units to 208,970 units within the one-month span, with notable activity recorded in the multi-residential sector.

CMHC’s report highlighted activities over several key markets. They include:

Toronto: Lower demand for multi-unit starts resulted in a lower trend for housing starts in July in the Toronto Census Metropolitan Area (CMA). Nevertheless, the pre-construction sales of multi-unit homes, particularly condominium apartments, have been strong for the last few years and will break ground at a varying pace throughout the year, and strong demand for relatively affordable higher-density housing continues to persist among homebuyers in Toronto.
Ottawa: Housing starts grew 5.3% from the same period last year with condominium apartments experiencing the strongest growth.
Vancouver: Housing starts continued to trend higher in July with more than 85% being multi-unit within Vancouver and Surrey. Overall, the continuous strengthening of economic fundamentals supported a steady growth of 25% in the year-to-date starts in the region between 2018 and 2019.
Winnipeg: The trend in total housing starts decreased in July compared to the previous month, mainly due to decreases in multi-family starts as both row and apartment starts trended lower. Single-family starts trended higher, but were not enough to offset the decreases in the multi-family units.
Montréal: Housing starts between January and July 2019 were up compared to the same period last year. This gain was solely attributable to rental housing construction, as condominium and single-family home starts recorded decreases.

CMHC reports the monthly seasonally adjusted annual rates (SAAR) of housing starts for all of Canada was down to 222,013 units in July, down 9.6% from 245,455 units in June.

Maclean-Hunter Building’s multi-res revival

Toronto’s Maclean-Hunter Building is on the rise. This spring, developer Davpart Inc. moved forward with plans to transform the iconic Maclean Publishing Company headquarters into the new United BLDG., a 55-storey mixed-use development that represents North America’s tallest architectural heritage retention project of its kind.

“The United Building will create a vibrant and dynamic atmosphere at the corner of University and Dundas,” says Carmine Colafella, Director of Property Management with Davpart. “It’s an opportunity for retail, office, and residential components to thrive and coexist in a true metropolitan fashion.”

The United BLDG project is taking shape at the corner of University Avenue and Dundas Street West. The plans are to keep the existing 224,245 sq/ft of office space and 39,320 sq. ft. of retail space up to its 10th floor and build 759 new condos residences from the 11th floor upwards.

B+H Architects are leading the build, acting as the prime consultant and design architects. Their team is joined by heritage consultants ERA Architects Inc. and Tomas Pearce Interior Design Consulting Inc.

Restoring an icon
It’s a new era for one of the city’s most iconic buildings. From 1910 to the 1980s, the century-old building was home to the Maclean Publishing Company (now Maclean-Hunter), creator of Canada’s premier Macleans magazine and now an international telecommunications company.

The property is listed on the City of Toronto Inventory of Heritage Properties. As such, Davpart’s first step was to rezone the designated heritage property within the context of preserving and restoring the existing building. The heritage work will include retaining, restoring, and enhancing the two buildings that comprise the site. They include a 1930s collegiate gothic building by Toronto architect Murray Brown, designed with New York’s Schultze & Weaver; and a second, modern stone office tower initially designed by Marani & Morris architects.

Upgrades will include the addition of more durable and better performing materials. The design will also take advantage of Toronto’s Enwave System, which draws its heating and cooling from the nearby Lake Ontario.

Outside, the United BLDG’s plans include a public art installation and outdoor arcade, the latter of which B+H Architects Principal Mark Berest says will bring a renewed sense of community to the district: “In some ways, bringing the old arcade out into the open will be honouring the significance of the intersection. It will make it much more lively and engaging public place.”

Speaking to the overall vision for the United BLDG, Berest says, “The design of this building draws from the energy of its location at the intersection of the city’s primary cultural, institutional and retail anchors as well as its preserved architectural and cultural heritage.”

“It will be a tribute to Toronto’s cosmopolitan character,” he adds.

Rising tall
Work on the landmark restoration began this summer. Looking forward, Davpart recognizes that one of the biggest challenges for the team will be to stay true to the Maclean – Hunter building’s legacy and complete the ambitious work with minimal disruption to the busy neighbourhood.

“Besides the challenges of undertaking such a feat in retaining the heritage walls, we are very cognizant that the neighborhood should not experience disruption during construction and by working with some of the best consultants and the City of Toronto, Davpart will strive for as little disruption as possible,” says Colafella.

She adds the team is especially committed to honouring the building’s legacy, noting, “The United Building is the largest heritage retention in North America to ensure its glorious history is not forgotten, but celebrated.”

Matt Bradford is Editor of CondoBusiness Magazine.

Canadian cities fertile for tech job growth

Toronto’s rocketing tech sector is reverberating in commercial and residential real estate markets. The city spawned more than 80,000 new tech-related jobs between 2013 and 2018 and is positioned third among 50 North American centres analyzed in CBRE’s recently released tech talent scorecard, trailing only entrenched hubs in the San Francisco Bay Area and Seattle.

Vancouver, Montreal and Ottawa also place prominently in the top 20, while six other Canadian markets — Hamilton, Waterloo Region, Edmonton, Quebec City, Winnipeg and Calgary — are included in a list of 25 burgeoning next-level tech centres. The rankings reflect CBRE’s assessment of each market’s competitive appeal based on 13 variously weighted indicators that collectively present a picture of employment trends and other factors helping to attract and sustain a tech labour force.

That encompasses 20 different occupations, including software developers, programmers, systems and data managers, and engineers and engineering technicians. As of 2018, about 833,000 Canadians, equating to 5.3 per cent of national employment, and 5.2 million Americans, representing 3.7 per cent of the U.S. workforce, filled such positions.

Approximately 37 per cent are embedded directly in the high-tech industry, while the larger remainder hold technical roles in other sectors. Notably, finance, insurance and real estate (FIRE) accounts for 8.3 per cent of all tech positions. Additionally, the high-tech sector has generated a roughly equal number of non-tech jobs in management and support services.

“Tech job growth has a multiplier effect in the economy and the influence of tech is reshaping virtually every sector of real estate,” affirms Paul Morassutti, vice chairman of CBRE Canada. “Tech talent workers are fuelling innovation and adapting technology within the non-traditional sectors to increase productivity and strengthen the Canadian economy.”

Tech industry tenants reportedly drove 20 per cent of U.S. office leasing activity in the first half of this year. Over the past year in Toronto, CBRE tallies the top five office deals involving tech tenants at collectively more than 1 million square feet of space.

That’s primarily destined for two new towers currently under construction downtown: 634,000 square feet in The Well, an Allied Properties-RioCan joint development at 8 Spadina Avenue; and 132,000 square feet in the Ivanhoé Cambridge-Hines project, CIBC Square, at 81 Bay Street. Yet, illustrative of the sector’s sweep, the other major deals are in less conventional nodes, including 145,000 square feet in a older, brick mid-rise building in Toronto’s inner-city Junction Triangle neighbourhood and 101,500 square feet in suburban Richmond Hill.

In the same period, the five largest tech office deals in Vancouver accounted for 671,700 square feet of absorption. The five largest deals in Montreal and Ottawa equate to 380,700 square feet and 188,600 square feet respectively.

Deepening talent pool improves conditions for innovation

The four Canadian cities all surpass the 50,000-worker threshold to meet CBRE’s characterization of a large tech talent labour pool — ranging from 228,500 tech jobs in Toronto to 64,500 in Ottawa as of 2018. While Toronto’s tech sector enjoyed the most intense growth spurt in North America over a five-year period, expanding by 54 per cent, and absorbing the second largest influx of workers in sheer numbers, Ottawa was one of only two surveyed markets to experience a decline in tech employment in the years from 2013 to 2018. (The other, Norfolk, Virginia, was ranked at the bottom of the list, 31 notches below Ottawa’s 19th place.)

Despite the slippage of 3,600 jobs, tech talent continues to comprise 9.9 per cent of Ottawa’s total workforce. This makes it the second most concentrated labour pool after San Francisco Bay Area’s 10 per cent, and ranks as a key impetus for innovation. Like Toronto and Vancouver, the city has also gained an above-average share of residents in their twenties — identified as the critical early-career demographic, which promises years of growing expertise and contribution into the future.

The pace of in-migration and affordability for both employers and employees also figures in projections of the potential for tech-based economic development. Factors such as post-secondary institutions, the match of skills to opportunities and the urban backdrop all contribute to nurturing the workforce and building tech industry scale.

“Both large and small markets have their advantages. While large markets tend to have a deeper pool of talent, small markets typically offer business and cost-of-living savings,” CBRE analysts submit. “Similar traits among markets cause many of them to appear equivalent, but top tech markets distinguish themselves from the rest with tech clusters and higher concentrations of tech talent.”

Because there are fewer per capita than in the United States, Canada’s post-secondary institutions typically loom larger in the economy and social fabric of their host communities. Toronto is deemed a beneficiary of thriving tech clusters linked to the University of Toronto and the University of Waterloo, while University of British Columbia and McGill University are similar triggers in Vancouver and Montreal. Waterloo is most prolific — identified as the pipeline for 314 start-ups that have raised USD $7.4 billion (CAD $9.7 billion) in capital — while McGill can claim bragging rights for 304 start-ups that have raised USD $7.1 billion (CAD $9.4 billion).

Toronto and Vancouver both welcomed inbound migration — dubbed “brain gain” — measured as the ratio of new tech jobs to the number of tech graduates from local post-secondary institutions. Arriving brains helped to fill 22,300 newly created jobs in Vancouver over the 2013-2018 period, equating to a 42.6 per cent tech job growth rate and propelling the city to number 12 in CBRE’s ranking.

In 13th place, Montreal added 16,600 new tech jobs in the same period, representing a 14.6 per cent expansion of a larger workforce. In total, 130,200 tech workers are employed in Montreal versus 74,700 in Vancouver.

Tech brains moving to a new city could expect to find the lowest rent in Montreal, pegged at USD $614 (CAD $810). However, even the priciest Canadian rent — Toronto’s monthly average of USD $1,069 (CAD $1,411) — ranks 35th among the 50 cities. Based on average rents and tech wages, Montreal-based tech workers also enjoy the greatest buying power in Canada and the third best of the 50 cities, with a rent-to-wage ratio of 12.6 per cent.

Renters in Vancouver would shell out about 20.7 per cent of their earnings for accommodations, while Torontonians would pay 20 per cent. Despite higher rents in Seattle, pegged at USD $1,694 (CAD $2,236) per month, tech workers there could expect to spend a lower percentage of their earnings, 17.3 per cent, on rental housing. In contrast, tech workers would have to allot 26.4 per cent of earnings to cover rental housing costs in the San Francisco Bay Area, which posts an average monthly rent of USD $2,856 (CAD $3,770).

Currency value differential bolsters cost competitiveness

Canadian cities are larger than most others in the top 20. Toronto, Montreal and Vancouver are the second, third and fourth most populous (after New York), while Ottawa has the ninth largest population. With approximately 6.4 million residents, the GTA is two and half times larger than the San Francisco Bay Area and nearly nine times larger than Seattle.

However, across the 50 North American markets, the differential in currency value serves up the lowest combined labour and space costs for employers in Ottawa, Toronto, Vancouver and Montreal. CBRE plots the cost of a 500-person tech firm occupying 75,000 square feet from a high of USD $59.4 million (CAD $77.2 million) in the San Francisco Bay Area to a low of USD $28.6 million (CAD $37.7 million) in Montreal.

The biggest chunk of Canadian savings is found in labour costs. Based on CBRE’s estimates, rent would account for a varying proportion of combined labour and space costs, ranging from 8.4 per cent in Vancouver to 5.7 per cent in Ottawa.

In Toronto, space represents 6.8 per cent of the projected combined costs, and would be 57 per cent cheaper than an equivalent amount of space in the San Francisco Bay area or 26 per cent cheaper than the same office footprint in Seattle. Labour costs would be nearly 48 per cent lower than in the San Francisco Bay area or nearly 41 per cent lower than in Seattle.

Start-ups or expanding companies might find it somewhat easier to secure office space in Seattle, which recorded a 9.4 per cent vacancy rate in the first quarter of 2019 versus Toronto’s 7.1 per cent vacancy. San Francisco presented a lower vacancy rate, at 6.1 per cent, and the second highest average asking rent of the 50 cities at USD $68.88 (CAD $90.92) per square foot.

Favourable cost comparisons also underpin Canada’s prominence in the list of 25 second-tier markets poised to ascend. Hamilton and Waterloo Region are ranked second and third, after Tucson, Arizona, and just ahead of Las Vegas. The two key regional anchors of the Greater Golden Horseshoe boast a combined tech workforce of nearly 39,000. Following 52 per cent tech job growth in the 2013-18 period, Hamilton now hosts 18,100 tech workers; Waterloo’s tech workforce expanded by 40 per cent, reaching 20,500.

“Opportunity markets offer quality labour pools and affordability that supports rapid scalability,” Morassutti says. “These markets can be ideal for small-scale operations, start-ups and tech jobs with non-tech employers like banks, media and service firms.”

Edmonton is ranked ninth on the next-25 list, while Quebec City, Winnipeg and Calgary are clustered in the bottom quintile. Calgary has the largest tech workforce — at 38,500 — of any of the 25 cities, but it’s one of two, along with Birmingham, Alabama, that lost tech jobs in the preceding five-year period.

VRCA announces 2019 Silver Award winners

The Vancouver Regional Construction Association (VRCA) has announced the Silver Award winners in its 2019 Awards of Excellence. These project‐specific awards recognize the regional construction association’s finest member companies and feature industrial, commercial and institutional projects from across British Columbia.

This year, 46 Silver Award winners have been selected in 15 project categories on the basis of criteria that includes the use of innovative techniques, new materials and/or exceptional project management.

“Every year, I’m blown away by the number of complex and challenging projects that our members take on and complete under tight timelines and often demanding conditions,” said Fiona Famulak, VRCA president. “This year, the total construction value of the nominations is over $840 million, which demonstrates how busy our industry continues to be.”

This year’s submissions include a new community centre that is home to seven outdoor aquatic amenities and a 600‐seat arena, university expansions and student housing, transit station upgrades, infrastructure enhancements, health care projects and tenant improvements to office and retail spaces.

The SFU Sustainable Energy Engineering Building (photo above), Vancouver Central Library and the Aldergrove Credit Union Community Centre are all winners in multiple categories.

“The VRCA’s Awards of Excellence Committee received presentations from an extraordinary group this year,” said Bob Proctor, chairman of VRCA’s Awards of Excellence Committee. “The challenges our members overcome to complete projects to the satisfaction of our clients and stakeholders continue to be remarkable.”

The Silver Award winners will be honoured at the Awards of Excellence Gala on October 28 at the Vancouver Convention Centre West. At the gala, one Silver Award winner from each project category will be announced as the Gold Award winner in their respective category.

For the full list of silver winners, visit VRCA. Look for coverage of all the winners in the November/December issue of Construction Business.

What FMs should know about irrigation systems

Irrigation systems play an important role in a facility’s appearance by keeping landscapes looking their best. While the basic components of a commercial system are similar to those of a residential one, it usually has more zones in order to cover a larger area, additional sprinklers and operates at specific times of day when watering can take place. A commercial system is also more prone to vandalism due to its larger size and greater on-site foot traffic.

ON CLOSER INSPECTION
It’s important to regularly observe an irrigation system in operation and provide any necessary maintenance as soon as possible to ensure optimal performance and water efficiency. At commercial properties, the system should be inspected twice a month, with sufficient time given to each zone to ensure it’s in top working condition.

During the walk-through, note the system’s overall design and installation to determine whether it follows irrigation best practices. The system should provide head-to-head coverage (sprinklers properly spaced so that a spray or rotor’s throw radius ends where the next one begins); matched precipitation rates (all sprinklers on the same zone emit water at the same rate so that certain areas are not too wet while others are too dry); and hydrozoning (plants with similar water requirements are grouped together).

This walk-through should bring any maintenance issues to light, such as tilted or sunken sprinklers, which can greatly diminish the uniformity of a system’s coverage, or broken sprinklers or pipes.

The system’s operating water pressure should also be evaluated at this time. When too high, sprinklers emit water as mist or fog, which will likely drift away instead of landing on its coverage area. Conversely, when pressure is too low, sprinklers will not spray water the proper distance, resulting in dry areas and what’s commonly referred to as ‘green donuts’ (non-uniform areas of turf). The inspection should look at plant appearance and health, too, keeping in mind overwatered and underwatered plants can often exhibit the same symptoms.

For instance, wilting or yellowing is not a good indication of dehydration; plants that exhibit these signs are more likely to have received too much water.

Check the soil in the immediate area to determine whether there’s too much or too little moisture present before making any scheduling adjustments.

REPAIR AWARE
When properly maintained, an irrigation system can provide many years of excellent service. However, commercial systems often suffer from a lack of regular maintenance, causing major issues to go unnoticed for a long time. This leads to significant water waste and even site damage when parts of the landscape receive too much or too little water. This damage manifests itself as exceptionally dry areas, soaked areas or erosion.

If, during an inspection, a damaged nozzle or faulty sprinkler seal is discovered, it needs to be replaced. Sprinklers that are simply out of adjustment can be fixed fairly easily. When valves exhibit leaks or other problems, removing any debris that may be affecting their performance is the first course of action.

Many valve issues can be resolved simply by taking them apart and cleaning them. When a sprinkler head needs to be replaced, it’s important to ensure the new head emits the same amount of water as its predecessor. This includes proper nozzle sizing as well as product consistency by using the same model of spray or rotor.

If an entire zone could benefit from a spray or rotor upgrade for better coverage and efficiency, all sprinklers in the zone should be changed, not just one.

A WISE INVESTMENT
The timer, or controller, is the irrigation system’s brain. That’s why today’s ‘smart’ or weather-based controllers offer facilities the best solution when it comes to efficient irrigation scheduling. These newer models automatically adjust the irrigation schedule as weather and watering requirements change throughout the year. In fact, they can update schedules every day as needed, something most facility managers and their maintenance teams simply don’t have time to do. Without weather-based controllers, the best a facility manager can do is make monthly seasonal adjustments to the watering schedule, which is better than nothing.

Still, the more often a schedule is adjusted to meet that day’s unique needs, the more efficient the system will become. Many newer controller models can be managed from smartphones or tablets using mobile apps, making it easier than ever to adjust schedules and monitor weather conditions.

However, an irrigation system is only as efficient as its weakest component; having a sophisticated controller will not conserve water or improve system performance if sprays, rotors or drip systems aren’t working efficiently. Regularly inspecting the irrigation system and making any necessary fixes or upgrades is the best way to ensure as little water is being used as possible in the pursuit of a healthy, beautiful landscape.

Craig Otto is a technical trainer for the services division of Rain Bird Corp. He is also the owner of Minneapolis-based Irrigation Otto. Rain Bird is a leading global manufacturer and provider of irrigation products and services, including online training on irrigation basics.

Anthem acquires 220 Bay Street in Victoria

Anthem Properties Group Ltd. and its partners have acquired a retail and office building on a 2.6 acre site in Victoria, B.C.

The 45,000 square foot single storey building at 220 Bay Street is in the heart of Victoria West, five minutes from the downtown core. It is fully leased with tenants including Castle Building Supplies, Carmanah Technologies and Big Brothers Big Sisters Victoria and Area.

“We’re extremely happy with this acquisition,” says Anthem’s director of investment, Jordan Carlson. “Victoria has consistently displayed strong economic fundamentals and we believe it will continue to evolve as a vibrant city with a diverse economy and highly attractive livability.”

This latest investment fits well into Anthem’s well-rounded portfolio in Victoria which includes Market Square, Union, Dominion Rocket and Tillicum Centre.

Last month, Anthem acquired 1500 S Street in Sacramento, California for $5.1 million. It is the company’s second acquisition in the downtown Sacramento area. The ¾ acre infill project is in an excellent location at the intersection of downtown and midtown, steps away from the largest employment hub in the region and the historic R Street Corridor filled with shops, restaurants and cultural amenities.

Anthem is working with architects and planners on a proposal that includes a mix of residential and commercial that will benefit and enhance the neighbourhood in keeping with its cultural and historic past. It expects to submit a formal plan later this year.

Sweeping changes in regulation

Self-regulatory professional bodies in the province and across the country are under increasing political, public and media scrutiny. Attention has manifested in the form of reviews, audits and new legislation.

Within this context, it is clear that changes to the regulatory landscape and how it will affect the profession of architecture in B.C. will be an area of focus during my term as president and for this year’s council.

The catalyst in B.C. was the Professional Reliance Review. Spearheaded by the provincial government, the Review was tasked with making recommendations that would “ensure that the highest professional, technical and ethical standards are being applied to resource development in British Columbia”.

The ensuing report ushered in the introduction of the Professional Governance Act which received royal assent in November 2018. The new legislation repealed and replaced the statutory law of five natural resource regulators:

Applied Science Technologists & Technicians of B.C. (Applied Science Technologists and Technicians Act);
Association of B.C. Forest Professionals (Foresters Act);
B.C. Institute of Agrologists (Agrologists Act);
College of Applied Biology (College of Applied Biology Act); and
Engineers and Geoscientists of B.C. (Engineers and Geoscientists Act).

Supplementary regulation, unique to each of the five sectors, is in the process of being introduced, and a superintendent to oversee the five professions was recently hired.

Several months ago, the College of Dental Surgeons of B.C. addressed a comprehensive audit of their governance and regulatory performance with an 81-page Action Plan addressing concerns. Meanwhile, the B.C. Health Professions Act, which in 1996 united a number of health regulators under one Act including the aforementioned College, is currently poised for review.

Outside of B.C., l’Ordre des ingénieurs du Québec, the self-regulatory body for engineers, was placed under the trusteeship of the provincial government for two years until it could demonstrate – which it did – its ability to regulate in the public interest. Last month, Quebec’s Minister of Justice introduced a lengthy bill to further modernize professional regulation, including redefining the practice of the profession of architecture and the profession’s “reserved activities”. In Ontario, a number of changes to the Regulated Health Professions Act came into effect as part of the implementation of the Protecting Patients Act.

The intense spotlight on regulated professions mixed with political might has translated into sweeping changes. The following recurring themes are emerging:

Additional government oversight in the form of meta-regulators with an overseeing superintendent;
Greater public representation on smaller boards with competency-based nomination processes;
Bylaws approved by boards and not registrants;
Use of the term “registrant” in lieu of “member”;
Mandatory professional development with non-compliance handled as an administrative matter; and
Clearly articulated “duties and responsibilities” sections which identify advocacy as outside of a regulator’s scope, and the explicit mandate of regulating in the public interest.

Also, of note is the speed at which change is happening. Government is moving quickly. The Professional Governance Act, which is close to 100 pages of new legislation, moved through the legislature in four weeks.

How does the highest enactment of the profession of architecture–the Architects Act –hold up? Last fundamentally changed in the 1950s, the Act does not take into account modern governance and practice principles and is due for an upgrade.

For many years, the AIBC has sought legislative change in the public interest, and continues to engage with the Ministry of Advanced Education, Skills and Training, as they review their legislative priorities and requests for legislation. Given the considerable movement in self-regulation, we remain hopeful that the Architects Act will see its way to modernization.

Now more than ever self-regulatory bodies are under the microscope and have an opportunity to speak to their public-protection mandates.

Unlike provincial legislation which is amended, repealed or replaced at the sole discretion of government, the AIBC has an opportunity to demonstrate leadership through attention to the regulatory authority under its purview: documents such as Bylaws, Code of Ethics and Professional Conduct, and Bulletins. Bedrock principles of regulation are found here and it is the Institute’s responsibility to ensure this material adheres to present-day standards.

Ultimately, the public is at the core of self-regulation.

The AIBC focuses its fiduciary duty to the public on effective governance and day-to-day operations. To this end, it sets, maintains and enforces entry, ethics and practice standards and keeps pace with modern governance principles.

But what about AIBC registrants? How do you deliver on the public-interest mandate?

As registrants, you meet high competency standards through rigorous education, examination and expertise. As volunteers who sit on Institute committees, you put the public’s interest first when discussing agenda items. As practitioners, you comply with the Architects Act and other public-protection enactments such as the B.C. Building Code, in addition to related AIBC regulation.

Self-regulatory public bodies are incorporated under provincial legislation and serve in the public interest. It bears repeating that the Architects Act is not owned by the Institute, but rather by the public through the legislature. Through statutory power, the AIBC is mandated to enforce the Architects Act and conduct its affairs accordingly.

With all this in mind, it is worth recalling the architect’s declaration: “I promise now that my professional conduct as it concerns the community, my work, and my fellow architects will be governed by the ethics and the tradition of this honourable and learned profession, in the public interest.”

Indeed, it is heartening to see in the present moment a concerned interest on the part of many of the value of professionals and our role in working for the public good.

Ian R. McDonald is president of the AIBC council and a partner at Carscadden Stokes McDonald.

The president’s message is reprinted with permission. Original post at AIBC.

Allied and Westbank announce plans for 720 Beatty Street

Allied Properties Real Estate Investment Trust (Allied) will provide Westbank with up to $185 million to fund the acquisition of an office building at 720 Beatty Street in Vancouver. The funds will also go towards pre-development costs and initial construction costs if necessary.

Located on the southwest corner of Beatty and West Georgia, the property is comprised of 51,817 square feet of land that Westbank intends to transform into an “urban workspace” by 2023.

According to the press release on completion of construction, Allied intends to become a 50 per cent owner of the 620,000 square-foot development and Westbank will manage it.

“Providing this funding to Westbank will enable us to generate an accretive return from the outset,” said Michael Emory, President & CEO in Allied’s press release. “As importantly, it will in time enable us to serve knowledge-based organizations more fully in Vancouver’s thriving urban workspace market.”

The funding is scheduled to start sometime this month.

Report: Improving safety in long-term care facilities

A public inquiry requested by the Registered Nurses’ Association of Ontario (RNAO) has resulted in numerous recommendations to enhance the safety and care of residents in long-term care facilities.

Helmed by Justice Eileen E. Gillese, the Public Inquiry into the Safety and Security of Residents in the Long-term Care Homes System’s final report provides 91 improvements for the long-term care (LTC) sector. The inquiry was motivated by the actions of former nurse Elizabeth Wettlaufer, who was convicted of murdering eight senior citizens in an LTC facility. It aims to bolster resident safety through by building greater capacity, staff training, improved medication management, and incident detection and prevention, among other strategies.

Recommendations highlighted by the RNAO include:

The Ministry of Health and Long-Term Care increase the number of registered nursing staff in long-term homes by undertaking a study and tabling results in the legislature by July 31, 2020.
LTC homes should adopt more robust hiring and screening practices, including background checks.
LTC homes must enact measures that will improve training with respect to hiring, management of staff and discipline.
Homes should require directors of care to conduct spot checks on evening and weekend shifts.
Homes should maintain complete discipline histories for each employee
The MOHLTC encourage, recognize, and financially reward long-term care homes that have demonstrated improvements in the wellness and quality of life of their residents.

“While we can’t undo the unimaginable terror Wettlaufer inflicted, we can honour the memory of the victims and the loss of their families by acting now to fix endemic problems in long-term care,” said Cooper Brathwaite, RNAO president. “Every resident deserves to live with dignity and support, and as a society we owe it to residents to take the steps recommended by Justice Gillese.”

Cooper added the tools for providing stronger care are already within reach, noting, “We have excellent nurses, proven best practice guidelines and, thanks to the inquiry, even more knowledge about where our system falls short … We urge the Ford government to quickly adopt the recommendations of the inquiry by working collaboratively with nursing associations and other stakeholders because residents in long-term care and their loved ones deserve no less.”

Holloway announces sale of hotels in Nova Scotia

Holloway Lodging Corporation (Holloway) – a real estate corporation focused on acquiring, adding value and operating select-service hotels and managing hotels for third parties – has sold two hotels in Nova Scotia.

Travelodge hotel in Sydney, N.S. for $5.1 million, and its leasehold interest in the Super 8 hotel located in Truro, N.S., for $3 million.

According to a press release, Holloway received approximately $7.7 million of proceeds after closing costs. Holloway expects to use the net sale proceeds to repay $4.8 million of its amortizing term loan and $2.9mn of its revolving credit facility. Holloway does not anticipate paying any tax on the sales of these properties.

Holloway owns 28 hotels with 3,121 rooms.

Cities at a glance:

Utilizing Current and New Digital Platforms

Deepening talent pool improves conditions for innovation

Currency value differential bolsters cost competitiveness

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