REALPAC calls for smoothing of tax inequities

An illogical quirk in the apportionment of business education tax continues to undermine competitiveness for some of Ontario’s major cities, advocates for the commercial real estate sector maintain. REALPAC, the organization representing many of Canada’s largest real estate companies and institutional investors, is urging the provincial government to replace the current patchwork of differing tax rates — inherited from the pre-1998 era when property tax directly funded school boards within the jurisdiction where it was collected — with a benchmark rate of 0.86 per cent.

“It would bring all Ontario cities to parity and relieve some tax pressure for businesses, small and large,” says Brooks Barnett, REALPAC’s director of policy and government relations.

Such a move would simply fulfill the promise made to commercial and industrial ratepayers more than 10 years ago, when the Ontario government of the day announced it would incrementally reduce higher business education tax (BET) rates over a seven-year period to bring them down to a consistent province-wide maximum threshold. However, that phase-down stalled in 2012 as the Province struggled to balance its own budget.

In contrast, all residential and multi-residential property taxpayers have had a harmonized education tax rate since 1998, which was pegged at 0.17 per cent in 2018. Scholars attribute the bumpier commercial/industrial BET landscape to a reluctance to inflict the significant tax increases that a uniform rate would trigger in some municipalities.

“Both Progressive Conservative and Liberal governments limited themselves to reducing rate variation. To that end, they deployed tax cuts where rates are relatively high, while avoiding increases where rates are relatively low,” Adam Found of Trent University, and Peter Tomlinson of University of Toronto, explain in a report commissioned by the Toronto Financial District Business Improvement Area (BIA) last year.

Thus, the report recommends the “optimized ceiling rate” that REALPAC is now promoting. That’s essentially a smoothing of tax inequities that Found and Tomlinson calculate could save businesses approximately $966 million per year. This approach would additionally support another long-stated goal of the Ontario government — to narrow the gap between residential and non-residential tax burdens.

Competitive imbalances

Today, discrepancies are less pronounced than examples in the early 2000s of commercial/industrial ratepayers in some municipalities carrying a share of the education tax burden 50 times greater than their counterparts in luckier locations. Yet, there are clear competitive imbalances among neighbours. Notably, commercial ratepayers in Halton Region, comprised of the Greater Toronto Area municipalities of Burlington, Oakville, Milton and Halton Hills, enjoy one of the lowest BET rates in the province — set at 0.84 per cent for 2018 — while their peers in neighbouring Hamilton were levied at a rate of 1.09 per cent this year.

“Toronto pays 33 per cent more than Halton. Waterloo, Kingston and London pay 62 per cent more than Halton,” Barnett reports. “Why does Ontario exact different rates for similar properties across the province? Business education taxes need to be reformed.”

Found and Tomlinson calculate that, in 2017, Toronto businesses paid $280 million more in provincial property tax than they would have if they were located in Halton. Elsewhere within the GTA, York Region — home to Markham, Vaughan, Richmond Hill and Newmarket — boasts one of the more attractive BET rates, at 0.96 per cent for 2018; Durham Region — encompassing Oshawa, Whitby, Ajax and Pickering — shoulders the less favourable rate of 1.07 per cent.

“The province uses an arcane rate-setting system that arbitrarily burdens some jurisdictions over others for no added benefit or service,” Barnett asserts. “It is important that the province recommit to gradual BET reductions to reach a 0.86 per cent uniform ceiling rate.”

The Toronto Region Board of Trade called for even more aggressive cuts earlier this year, as part of a strategy to capture a larger share of investment and spur economic development. Dubbing it a “competitiveness play” that is, in part, a response to dramatic corporate tax cuts introduced in the United States for the 2018 tax year, the Board of Trade recommended reducing the BET rate to 0.33 per cent — the lowest rate currently levied in the province. (A negligible number of commercial property taxpayers actually benefit from that preferred rate found only in Northeast Ontario’s Chamberlain Township, which registered a population of 332 in the 2016 Census.)

Those recommendations arise from the joint efforts of the Board of Trade, the Conference Board of Canada and Council of the Great Lakes Regions to gauge Ontario’s ability to attract business relative to Quebec and 13 U.S. states. The resulting report, released ahead of last spring’s Ontario election, argued that reducing and harmonizing the BET would promote fairness, reduce the overall tax burden on business, and provide a “substantial relief to small businesses, which are most affected by high energy and wage costs”.

New CEO search for Industry Training Authority

The Industry Training Authority (ITA) announced that Gary Herman, chief executive officer (CEO) has left the organization effective September 12, 2018. The Industry Training Authority will commence a search for a new chief executive officer and is focused on its renewed mandate.

Herman joined the organization as chief operating officer in January 2013. Herman was appointed interim CEO in August of that same year, then permanent CEO in August 2014.

ITA board chair Roberta Ellis said the board appreciates Herman’s service and recognizes the contributions he has made in his executive roles in the organization. “We wish him well in his future endeavours.”

During the transition period, chief operating officer Shelley Gray will lead the organization as interim CEO.

Gray joined the organization in 2013 as director of Customer Experience leading the successful launch of the Apprenticeship Advisor program across the province and building a strong industry relations team.

She has a BA in International Business from the University of Alberta, a Leadership Development Certificate from the UBC Sauder School of Business and she recently completed INSEAD’s Executive Leadership Certificate in Driving Value through Business Acumen.

ITA leads and coordinates British Columbia’s skilled trades system. ITA works with apprentices, employers, industry, labour, training providers and government to fund training, issue credentials, support apprenticeships, set program standards and increase opportunities in the trades.

Formica Canada launches student design competition

Formica Canada Inc. has launched its 2019 FORM Student Innovation Competition, inviting interior design and architecture students to create furniture designs using Formica brand laminate. Students have the chance to win cash prizes, attain international recognition and have their work showcased in a public exhibit.

Participants must use three or more Formica-brand laminate products to create a “resi-mercial” furniture design that blurs the line between residential and commercial spaces. The industry and design professionals that are tasked with judging the entries include Leanne Ford, interior designer and star of “Restored by the Fords” on HGTV; Tristan Butterfield, chief creative officer at Baker Interiors Group; Jaime Velez, former director of interior design at SOM; Renee Hytry Derrington, global design lead at Formica Group and Steven Matijcio, curator for the Contemporary Arts Centre in Cincinnati.

“As we continue to see the line between commercial and residential design blur, with residential spaces inspired by hospitality settings and office and health care environments designed to feel like home, we are excited by the emergence of the “resi-mercial” trend,” said Hytry Derrington, in a press release. “I can’t wait to see what today’s talented students will envision in their entries.”

The 2019 FORM Student Innovation Competition is accepting entries until December 10, 2018. Winners will be unveiled on March 11, 2019. The grand prize winner will receive an award of US$1,500 cash, and their design will be created and displayed at an unveiling event at the Cincinnati Contemporary Arts Centre on March 22, 2019. The second-place winner will be presented with a cash prize of US$1,000, and the third-place winner will receive US$500.

“I am so excited to see how students interpret the new wave of “resi-mercial” design,” added Leanne Ford. “In reality, this is a style that has been around for years and will continue well into the future, but now it has a name. I love that these rising design students will undoubtedly have an impact on how it continues to evolve as they jump into their careers.”

The 2019 FORM Student Innovation Competition is inspired by the original contest, which was held in 2008, in which the company invited 10 world-renowned designers and architects to create artwork using Formica brand products. The design professionals created products ranging from domestic pieces to conceptual sculptures, which were then exhibited at the Contemporary Arts Centre. The 2019 FORM Student Innovation Competition upholds the spirit of the original competition.

IFMA officially appoints Don Gilpin as COO

The International Facility Management Association (IFMA) has officially named Don Gilpin as Chief Operating Officer (COO), effective September 17, 2018. Gilpin has served as IFMA’s interim COO since early February.

“While this is welcome news, it isn’t a big surprise for anyone here at IFMA,” said Graham Tier, IFMA board chair, in a press release. “For the better part of this year, Don has led IFMA’s operations through some big changes, while contributing to an operational culture that promotes value for our members, partners and collaborators. In doing so, he has earned the trust and respect of staff and the global board. I’m confident that IFMA’s operations are in good hands.”

Gilpin earned a bachelor’s degree in business administration from Franklin College in Franklin, Indiana. Gilpin has strong experience in international association management, trade show production, education/certification program, legislative advocacy and workforce development. Prior to joining IFMA, Gilpin served as executive director and COO at the Custom Electronic Design and Installation Association (CEDIA), where he was an active member in helping form two industry organizations for the electronic systems industry. He has also held the position of executive director – Interior Design Educators Council at Raybourn Group International; director of trade shows, marketing and magazine publishing at the National Precast Concrete Association, and marketing roles for Deluxe Corporation and Dayton Hudson Corporation.

“Over the past eight months, I’ve witnessed the positive impact IFMA has for our membership and the global FM industry,” added Gilpin. “This is an exciting time to be involved with everything happening in FM around the world, and IFMA is in an incredibly strong position to deliver unparalleled value, whether through our top-tier events, our world-class professional development products or more of the thought leadership that got us here in the first place. I want to thank Graham and the entire board for their confidence in me. I also want to thank IFMA’s hard-working staff who have made this role such a pleasure. Now, let’s build something great together!”

Employee experience drives design

With so many people having choices in where they do their work — ranging from third places, airport lounges, hotel lobbies, or simply at home — they have higher expectations for what the work experience should feel like. Now they ask: What’s the draw to the workplace? What is the workplace’s new value proposition? And how should the job of the work environment evolve?

Experiences are key to defining human interactions. Just as consumers choose the experience of shopping as much as they choose the products they buy, progressive companies see the workforce as their “customers” and look to turn current and future employees into the best thing possible: true believers.

This trend is having a significant impact on the workplace, which plays an important role in setting the tone for culture. In earlier times, an office’s job description was about communicating presence: the building, sign, and logo. In that paradigm, the workplace was considered a cost — a container to fill with people, furniture, and tools.

The new job description is different. It turns the workplace into a valuable asset — one that is designed to support people in myriad ways, not simply house them. Today, employees are consumers of space.

A business’s best customers become repeat buyers because they love the experience they’re offered. The same holds true for employees when a great workplace is sustained by great work experiences.

This means businesses must transition their approach to workplace design by considering and designing for the experiences their workforce looks for when it comes into the office every day.

Modes of experience

A fundamental element of designing for experience is understanding a person’s intention and how it frames his or her experience. Though there are myriad reasons why people do what they do, Gensler’s Research Institute identified five distinct categories, or “modes,” of experience.

Task: Task mode describes when a user has a clear task they are trying to accomplish in the space. In task mode, employees are concentrated on heads-down, focused work.
Social: In social mode, employees are open to engaging with colleagues.
Discovery: In discovery mode, employees are looking to uncover new things.
Entertainment: This mode describes the moments when people are looking to be entertained and brought away from “everyday life.”
Aspiration: Aspiration mode describes the experiences through which users seek to grow, expand, or be connected to the larger purpose of the organization.

What does this mean for the design of the workplace? It means that the mental model people hold of the office needs to shift from the static idea of simply being a location to do one thing — work — and instead become the dynamic notion of an ecosystem that supports, enables and encourages a multitude of experiences.

The workplace ecosystem

A workplace ecosystem will set the stage for different modes of experience to emerge naturally and authentically. In fact, Gensler’s research also uncovered that 98 per cent of people report being multi-modal on a daily basis.

In addition to desks and focus pods for the heads-down work typically associated with the office and task-mode activities, an experience-oriented workplace will provide the spaces and the programming required for all the other modes to exist too.

That could look like cafes and pantry areas for socializing, outdoor spaces for discovery, and townhall spaces specifically programmed for entertainment and aspiration.

The overall design look and feel of a space influences positive emotions, which in turn influences positive experience — and positive emotions and experience are at the heart of engaging users, connecting employees to organizational purpose.

Annie Bergeron is a principal at Gensler.

Pictured: The Collective, a Seattle, Washington-based social club.

Hurricane Florence could swamp asset values

Valuation analysts are underscoring the case for factoring climate risk into investment and asset management decisions as Hurricane Florence moves in the direction of more than 5,500 properties that real estate investment trusts (REITs) own. In addition, data engineering and interpretation specialists with the proptech firm, GeoPhy, tally 2,900 properties and loans in the storm’s path that are collateral for commercial mortgage-backed securities (CMBS).

As the U.S. National Ocean and Atmospheric Agency (NOAA) monitors the approaching storm, Ali Ayoub and Nils Kok scrutinized 94 REITs with holdings located in the areas flagged for storm surge and other severe weather fallout to calculate the number of assets exposed and the percentage of each portfolio those assets represent. For CMBS deals, they looked at the number of assets exposed, the percentage of each loan’s collateral they represent and the appraised value of the properties.

“Consider the threat of Hurricane Florence a ‘clear and present danger’ for investors and lenders to the real estate sector,” they warn in a Sept. 12 posting.

Lessons soon to be learned may reinforce the duo’s advisory earlier this year, in which they drew on flood risk data from the U.S. Federal Emergency Management Agency (FEMA) and the Climate Impact Lab’s predictive modelling of the economic repercussions from climate change. Across the portfolios of 131 REITs potentially vulnerable to flooding, approximately 5 per cent of assets are in settings FEMA classifies as high-risk.

“The value-at-risk is, of course, much higher,” Kok and Ayoub noted.

Asset managers awaiting Hurricane Florence may not have a lot of room left to manoeuvre — “When it comes to natural disasters, buildings, once constructed, are much like sitting ducks,” Kok and Ayoub concede — but they argue that investors could and should be better informed. For example, loan delinquency can be a consequence of natural disasters as commercial tenants default or find themselves displaced, while rating agencies typically give climate risk or resiliency fairly rudimentary weighting.

“Hurricane Florence should be of particular interest to CMBS investors,” Kok and Ayoub assert. “While investors stay attuned to daily news about interest rates, employment figures and the latest on the continuing trade war saga, financial markets are less apt to reflect on the pending impact that climate events may have on asset values.”

BBA Design creates a modern dining destination

After an extensive renovation, the Courtney Room restaurant located in the Magnolia hotel is a bright, open and modern dining destination in Victoria, B.C.

The clients asked BBA Design Consultants to create a restaurant with a modern take on French bistro that would differ – but be timeless – in its approach and uphold the classic experience of the award-winning boutique hotel that it is associated with.

The desired theme: to create an elegant room where old world meets new inspired by Chef Sam Harris’ menu celebrating local and seasonal products with a classic French twist.

The existing restaurant was dark with dropped ceilings and had three levels creating a very enclosed space. To open the space up, the existing bulkheads were removed, creating a brighter space reminiscent of historic buildings with their grand, high ceilings.

Dark acoustic ceiling tiles and dropped ceilings were replaced with classically inspired white ceiling tiles and this theme continues through to the walls, bases, dado mouldings and ceiling crowns with refined and simplified detailing. Painting the wall and ceiling surfaces white adds to the elegance.

While the lounge and bar attract attention with their high top tables, feature oyster bar and back-lit bar shelves, the classically inspired tiled entrance, chevron wood flooring, and curved banquette create a casual dining experience on the lower bistro level.

The bar and lounge offer a lively, gathering space with an elegant marble bar showcasing a custom glass oyster station while the brasserie is casual and relaxed with its chevron patterned wood floor, bistro style banquette and vintage inspired lighting. A more intimate, elevated dining experience can be found in the carpeted space upstairs, with white tablecloths and a glassed in wine room.

The tall windows flanked by short ones were an overlooked feature in the previous restaurant. The design team transformed these windows with crisp, new paneling and full-length beaded curtains.

The beaded bronze window treatment add a rich textural element to the space evident in the early evening where the light dapples and dances off the furnishings creating a warm glow.

Opened in May 2018, the Courtney Room restaurant has already made the list of Top Ten Best Restaurants in Victoria by Diners’ Choice.

How to effectively spray buff a floor

Somewhat a lost art, spray buffing has now resurfaced not only as a key to stretching floor refinishing cycles, but also at removing heel marks, stains, spills, and leaving floors with a high-gloss shine.

Schools all over North America are now in the final stages of preparing their schools for the fall season. One of the big tasks is stripping and refinishing floors. Many cleaning professionals have implemented steps to stretch refinishing cycles, sometimes as long as 24 months. But, the effectiveness of this strategy is very dependent on spray buffing the floor.

For those that need a refresher course on spray buffing, James Flieler, VP of sales and marketing for Charlotte Products Ltd., reviews some of the key steps in the process:

Cordon off the work area with wet floor signs
Dust and then damp mop the floor using a good quality pH neutral cleaner
Use a cleaning solution specifically engineered for spray buffing; “sometimes cleaning professionals mix their own concoction. It’s always best to use a product expressly manufactured for this task.”
Start at the farthest end of the area and walk backwards, towards the exit
Always mist the spray over the equipment directly onto the floor; “realize that small amounts go a long way”
Using a low-speed floor machine, with a clean spray buffing pad move the machine side-to-side over about a three foot wide area of the floor; this needs to be performed twice
Let the machine linger over heavily scuffed floor areas to remove them; in some cases, these areas may need to be cleaned first using a little “elbow grease.”
Finish by dust mopping the floor

“A few more things to remember,” added Flieler. “Never let the spray buff solution dry. If it does, clean the [floor] area and then re-mist. And for best results, don’t rush the process. Moving slowly over the floor brings out the shine.”

James Flieler, VP of sales and marketing at Charlotte Products Ltd.

Microsoft Canada moving headquarters to Toronto’s CIBC Square

Microsoft Canada has announced plans for new headquarters located in downtown Toronto. Comprising 132,000 square feet over four floors of the building, located at 81 Bay Street, construction is well underway with occupancy expected for September 2020.

Microsoft says moving to CIBC SQUARE — a project by Ivanhoé Cambridge and Hines — will allow the company to better serve its customers, collaborate with its technology partners and to attract top talent to a central location, one well served by transit and more accessible to universities and innovative new tech start-ups. The relocation is just one of a series of investments Microsoft is making in Canada over the next four years.

“Increasingly, Canada is being recognized as a global leader in technology and the investments we are making today and into the future will help ensure Canada continues to be a hotbed of innovation,” said Microsoft Canada President Kevin Peesker.

“By relocating our headquarters to downtown Toronto, we will be able to better serve our customers and attract top talent to continue to drive innovation and growth for our Canadian customers and our large partner ecosystem.”

Currently, Microsoft employs more than 2,300 employees across Canada, and supports an extended ecosystem of more than 14,000 trusted partners who sell, service or deploy Microsoft products. The company expects that given the pace of technology and the investments it is making that the Microsoft ecosystem could account for more than 60,000 new jobs by the time its new headquarters opens in two years.

Investments in Canada include:

$111M in Azure credits into the startup ecosystem by supporting 5,700 start-ups
Donating more than $178 million in cash, software and technology services to Canadian non-profits; and
enabling employees to contribute up to 100,000 person-hours annually of volunteer time in support of worthy causes, representing an equivalent dollar value of $10million

Microsoft Canada also intends to:

Grow staff by more than 500 full-time employees, with an additional 500 co-ops/internships by 2022
invest $21 M in Azure credits to Canada’s Supercluster initiative
invest $10M over 5 years into Cascadia innovation corridor which is formed between Washington and British Columbia to create new economic opportunities; and
invest more than $570M in next 3 years in fixed assets in the country, including relocation and expansion of its research and development lab in Montreal, relocation of its Vancouver sales office, renovation and redesign of its Ottawa, Calgary and Montreal sales offices, and the relocation of its Canadian headquarters.

Photo by Ivanhoé Cambridge

Royal Roads University opens innovative facility

Victoria’s Royal Roads University has officially opened the new Sherman Jen Building which included major renovations and upgrades to a century-old building (the former Mews Building) and construction of a modern addition.

Opened in early September 2018, the new centre features modern teaching spaces as well as enhancements to its original architectural and heritage features. It also houses upgraded and expanded science labs supporting research in marine geology, soil toxicity, habitats, migration and climate impacts.

“Students at Royal Roads University are discovering ways to solve real-world problems in environmental sustainability,” said Melanie Mark, B.C.’s Minister of Advanced Education, Skills and Training. “They’ll now have modern facilities to help them thrive and succeed. Royal Roads students are our future leaders in areas such as agricultural food waste management and innovative recycling initiatives, and they’re helping build the best B.C.”

The $24.8-million project budget includes $9.3 million from the Government of Canada’s Post-Secondary Institutions Strategic Investment Fund, $5.7 million from the Province of British Columbia, and $7 million from philanthropist Sherman Jen, with the balance supplied by Royal Roads University.

The 4,700 square-metre project includes 2,700 square metres of renovated space and a new 2,000 square-metre addition. The new facilities house environmental science teaching labs, wet labs, and academic support and integrated student service space.

The Sherman Jen building, with its light-filled gathering area, will be the campus hub for undergraduate students at Royal Roads. A new student commons space to foster international and intercultural understanding will help students from different backgrounds create lifelong connections and professional partnerships.

RAIC unveils new Governor General’s medals

The Royal Architectural Institute of Canada (RAIC) will unveil a beautiful new design for the Governor General’s Medals in Architecture at the 2018 awards ceremony in Winnipeg. Awarded every two years, the Governor General’s Medals in Architecture celebrate outstanding design in recently completed projects by Canadian architects.

“We are very pleased to share the new medal for architecture named for the Governor General of Canada,” says RAIC president Michael Cox. “The medal has been refreshed and redesigned. It reflects our history and the contemporary nature of architecture. The medals are beautiful works of design and symbolic tokens which reflect the esteem in which we hold the recipients. We are delighted to inaugurate the medal at this year’s award ceremony.”

The updated Governor General’s Medal in Architecture depicts a lion which is a symbol of the Governor General of Canada, on behalf of which the medals are awarded. The lion is wearing a crown of maple leaves and holding a compass. The crown indicates that the awards program is administered by the Royal Architectural Institute of Canada. The maple leaves signal that this is a Canadian award. The compass is a drawing and measuring tool for architects.

The lion is sitting on a rocky mount between two oak trees with acorns. The rocky base and the trees represent two of the most common construction materials — stone and wood. They also evoke a landscape. In the same way as a building, the oak tree, symbolizing sturdiness and excellence, expresses the notions of shelter and protection.

The image is encircled by a motto in Latin “Recognizing excellence in architecture” which is the purpose of the medals. The name of the winning project and firm is engraved on the reverse side.

The medals were designed under the auspices of the Canadian Heraldic Authority with direction from the RAIC board of directors. The medals were produced by the Royal Canadian Mint. The previous medal was designed in 1982 and depicted a lion with a crown holding a maple leaf.

photo credit: Couvrette/Ottawa

Five benefits of training videos in the JanSan industry

In many industries, training videos have become an additional layer of training and instruction. They create a deeper understanding of how to perform specific tasks, and the training they provide appears to have “staying power.”

This is important because studies indicate many people forget most of what they have been taught within 30 minutes of a training session. While some organizations in the professional cleaning industry such as Kaivac, with their KaiTutor™ training system, have introduced training videos designed for cleaning workers, many others have not realized the power training videos can have.

To help JanSan industry organizations appreciate the value of training videos, here are five of the key benefits of using videos to help train cleaning workers:

Cost Savings

While training should begin with in-person training instructors, “follow-up training should be turned over to training videos,” says Matt Morrison, communications manager for Kaivac. “This can drastically reduce the amount of time [necessary] to train workers, producing significant cost savings.”

Worker Engagement

Videos engage and motivate workers, says Morrison. “They also make people feel like they have their own personal trainer, helping them learn,” he adds.

Accessibility 24/7

Some video training systems attach to cleaning equipment so that they can be accessed whenever and wherever the equipment is used. This way, cleaning workers can review things they have been taught, to make sure they are performing tasks correctly.

Play, Pause, Practice.

Training videos are especially valuable when training new workers. They can watch how a task is performed; stop the video, and then practice performing that task. “Employers… must allow ‘learning by doing’ to be the dominant teaching method for training because of the potential for costly errors made by novice employees,” said Roger C. Schank, Ph.D., formerly with Northwestern University.

Eliminates Embarrassment

When a worker is performing poorly or not performing a task correctly, the reason may be they are too embarrassed to ask for help. Asking for help is not an issue with videos that are available for help at any time.

Tom Morrison is the vice-president of marketing, Kaivac, Inc., a developer of science-based hygienic cleaning systems that protect the health of building occupants while raising the value of cleaning operations. For more on training videos visit www.kaivac.com

Home ownership more affordable than renting: report

According to a new consumer report from Mortgage Professionals Canada, the soaring cost of rent is making it more cost effective to own a home, now and in the future.

The report, Owning versus Renting a Home in Canada, compares the expected costs of housing for Canadians that rent versus those that own a home. In the 266 scenarios discussed in the report, which were taken from a broad cross-section of regions throughout the country, the current monthly cost of home ownership is actually lower than the cost of renting equivalent housing in the majority of cases, and becomes even more cost-effective over time.

“The report demonstrates that the money Canadians are spending on monthly rent, if used instead to finance a home, would be a very beneficial investment over time,” said Will Dunning, Mortgage Professionals Canada’s chief economist and author of the report, in a press release. “The costs of owning and renting continue to rise across Canada. However, rents continue to rise over time whereas the largest cost of home ownership – the mortgage payment – typically remains a fixed amount over a set period of time – usually for the first five years. The result is that the cost of renting will increase more rapidly than the cost of home ownership.”

Although more Canadians are becoming used to the idea that they may never be able to own a home and become lifelong renters, the report suggests that those who do have the opportunity to invest in home ownership will be significantly better off long-term. The study compares the costs of renting five and 10 years in the future.

For example, the report finds that if mortgage rates remain at 3.25 per cent, in 10 years the cost of ownership (on the net basis that takes out principal repayment) will be lower than the cost of renting in almost 98 per cent of cases. On average, the net cost of owning will be $1,295 less than the monthly cost of renting an equivalent residence. If the interest rate increases to 4.25 per cent after 10 years, the cost of ownership is less than the cost of renting in 92 per cent of case studies, with an average saving of $1,014 per month. Even with interest rates rising to 5.25 per cent in 10 years, home ownership will be less expensive than renting in 82 per cent of cases, saving home owners about $726 per month compared to renters.

“Using conservative expectations for rental increases over time, there is a clear financial benefit of owning versus renting,” said Paul Taylor, president and CEO of Mortgage Professionals Canada. “While recent changes to mortgage qualifying have made the barrier to entry higher, those who can qualify will be much better off in the long term. Given the economic advantages of home ownership, Mortgage Professionals Canada would recommend the government consider ways to enable more middle-class Canadians to achieve home ownership. Our collective long-term economic success may be compromised without that support.”

The report notes that in all 266 scenarios, once a mortgage has been fully repaid, the cost of owning a home will be significantly lower than the cost of renting. In 25 years, on average, the cost of owning is projected at $1,549 per month, compared to $4,655 for renting an equivalent residence.

In addition, after reviewing data from Statistics Canada on wealth in the country, the report finds that homeowners are in better shape financially compared to tenants who are similar in age and level of income.

“Everyone wants to save for their future, but rising costs, including rent, are making that more difficult,” added Dunning. “The lower life-time costs of home ownership mean that owners have more ability to save for retirement than do renters. The financial benefits of home ownership go beyond equity accumulation.”

National housing starts trend down in August

The national trend in housing starts continued its downward path in August compared to the historical peak recorded in March 2018, reports Canada Mortgage and Housing Corporation (CMHC). This moderation brings total housing starts closer to historical averages, largely due to recent declines in the trend of multi-unit starts from historically elevated levels earlier this year.

The trend in housing starts was 214,598 units in August 2018, compared to 219,656 units one month before. This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.

Highlights by Census Metropolitan Area (CMA):

In Vancouver, housing starts trended higher in August 2018 as more multi-family projects were started across the region. The cities of Vancouver and Burnaby led the way and accounted for over half of the region’s housing starts during the month due to a number of new condominium apartment projects. There continues to be a strong demand for housing from Vancouver residents, resulting in the pace of new home construction so far this year moving ahead of the level recorded during the same period in 2017.

Despite August being a very strong month for housing starts in Kelowna, the first eight months of this year have seen a decline of 29 per cent in the single-detached segment and 28 per cent in the multi-unit segment, relative to the record amount of housing construction seen in 2017. Despite this decline in construction activity, the pace of housing starts in 2018 remains well above the 10-year average.

The trend measure for housing activity in the Edmonton CMA climbed significantly in August, driven by an increase in new construction of multi-unit dwellings. Despite the rebound in construction activity last month, housing starts in the first eight months of 2018 remain approximately seven per cent below the pace of activity of the same period in 2017, as builders deal with raised inventories of completed and unsold units.

In Winnipeg, total housing starts trended higher for the second month in a row. Total housing starts increased by almost a third in August 2018 compared to August 2017, due to an increase in both condominium and rental apartment construction. Declining inventories have supported new construction.

Toronto’s total housing starts trended lower in August 2018, mainly due to fewer condominium apartment and single-detached home starts. Rising prices and land constraints have slowed sales of pre-construction single-detached units over the past several years, resulting in fewer single-detached starts to date in 2018, when compared to the same period in 2017. However, strong pre-construction sales of condominium apartments over the past couple of years have led to a higher level of condo starts so far in 2018, despite the pull-back in August.

In Oshawa, total housing starts trended higher in August 2018, due to higher trending multi-family starts, especially row units. August recorded the most actual row unit starts for the month in nearly three decades. Although demographic and economic conditions remain favourable, higher home prices in Toronto and the surrounding regions continue to increase the popularity of comparatively more affordable higher density housing in Oshawa.

Although housing construction in Windsor was slow during the first half of 2018, it continues to rebound now. The trend in new housing construction grew for the third consecutive month, due in large part to greater multi-unit construction. Year-to-date housing starts fell 27 per cent compared to the same period last year, as 2017’s active housing market eased.

In Kingston’s CMA, the August trend in total housing starts fell slightly for the first time in five months, however, it remained close to the high level experienced over the past year. This strength follows a strong year for housing starts in 2017 and a healthy 2018 so far. Demand has likely been supported by the relative affordability of all home types in Kingston, compared to other Ontario CMAs.

August 2018 saw Saguenay’s year-to-date housing starts rise compared to the same period last year. However, the trends differed depending on the market. In the freehold (single- and semi-detached) housing segment, an increase in housing starts was recorded. Meanwhile, conventional rental housing construction fell, especially due to a relatively high vacancy rate and net migration deficit.

Although construction activity for single-detached homes in Halifax remained stable on an annual basis, multiples starts this month have more than doubled last year’s levels. So far in 2018, multiples construction has outpaced the same period last year by seven per cent, with rental market demand continuing to be impacted by growth in international and interprovincial migration into the Halifax region.

The trend in total housing starts rose in August in New Brunswick. Construction of multi-unit buildings has increased by 13 per cent so far this year. Single housing starts were the highest for the month of August since 2015, and have increased by nine per cent so far this year.

Absence of natural light hurts the employee experience

Exposure to natural light and a view ranks higher than other office perks such as cafeterias, fitness centres, medical care and even childcare, according to the Employee Experience Study.

The study, conducted by Future Workplace, an HR advisory and research firm, and View, a manufacturer of smart glass, revealed that a majority of employees want access to natural light and views because this improves their overall happiness and well-being. Seventy-three percent said access to natural light and views contributed to work satisfaction and 70 per cent see it as a positive factor towards performance.

“While treadmill desks and nap pods sometimes get a lot of hype, the study clearly found that essential things such as optimized natural light and views are the most impactful and valued office perks,” said Jeanne Meister, founding partner of Future Workplace.

Over a third of the 1,614 respondents across the U.S. and Canada queried in the survey feel they don’t get enough sunlight in the workplace. 43 per cent reported feeling gloomy as a result of the lack of light and 47 per cent admitted they felt tired from the absence of natural light or a window at their office.

Over half of employees say that prolonged screen-use leads to eyestrain or headaches at work. As eyestrain rises in the modern workplace so too does the desire for employees to take a visual break from their technology devices such as taking a walk or glancing at the view outside.

“As companies increasingly strive to make their employees work better and be healthier, placing them in office spaces with the optimal amount of natural light should be their first priority,” said Dr. Brandon Tinianov, vice-president of industry strategies at View.

UBC reveals new student residence project

A new gateway student residence building on Student Union Boulevard at the University of British Columbia (UBC) Point Grey campus will meet growing demand for more housing.

Vancouver-based design firms Hotson Architecture and Ryder Architecture have been selected by UBC Properties Trust as the architects of the project.

The $108 million residence building will provide 1,000 beds for upper year students, and contribute to the rejuvenation of the intersection at the northwest corner of Wesbrook Mall and Student Union Boulevard that includes existing student service areas, student residences, and a large mixed-used academic / student housing hub.

“The project will introduce more of a urban development around the existing Gage Residences, which will address, reinforce, and animate the street frontages along Student Union Boulevard and Wesbrook Mall,” says Kai Hotson, principal, Hotson Architecture.

According to Norm Hotson, “the intent is to allow for the creation of new academic and social spaces that will contribute to a complete community on campus for people to live, work, learn and play.”

The residence will consist of a number of buildings, totaling an area of approximately 395,000 square feet. The project is to break ground in the spring of 2019 with a targeted opening date of 2021. UBC Properties Trust is developing the site on behalf of Student Housing and Hospitality Services (SHHS).

“As a team, we are driven to maximize efficiencies and value, including designing for regenerative sustainability,” says Adam James, principal, Ryder Architecture. “By employing digital processes, such as Building Information Modeling (BIM), we will meet the project’s objectives through the optimization of process, the use of less materials and energy, while achieving a cohesive architecture.”

Chartwell unveils plans for Guildwood retirement residence

CHARTWELL Retirement Residences and Welltower Inc. announced plans for a new residence located within the historic Guildwood neighbourhood of Scarborough.

The Chartwell Guildwood Retirement Residence is expected to open in early 2020 and will offer 172 suites covering a spectrum of accommodation and service options. Residents will have access to various support and care services as their needs change.

The residence will include independent living apartments, independent supportive living suites and a dedicated Memory Living neighbourhood for those with memory impairment, requiring a secure, supportive and specialized living environment.

Chartwell Guildwood will feature architectural elements inspired by the local historic Guildwood Village and incorporate biophilic design considerations intended to maintain the innate connection between residents and nature promoting health and supporting wellbeing.

Among the many amenity offerings will be a music room; indoor pool; art room; and various dining venues. The residence will be pet-friendly with walking paths and even a pet wash station.

Chartwell has been working closely with the municipality and neighbourhood Guild Association to establish its commitment to supporting the community. As part of the City of Toronto development approvals process for the project, Chartwell and Welltower donated $175,000 in community benefit that will be used for capital improvements in the Guild Park and Gardens.

“We look forward to bringing this new residence to the community, as the seniordemographic in Toronto will grow significantly over the next ten years,” said Teresa Fritsch, Senior Vice President, Real Estate and Investments at Chartwell. “Together with Welltower, we will be investing $72 million to develop this project, increasing the availability of services and accommodations to this growing demographic. The project will support local economic activity by creating 150 construction jobs and related opportunities, and will employ more than 45 permanent positions when open.”

To assist in meeting the growing demand for seniors’ housing, Chartwell Retirement Residences currently has 24 projects at an estimated investment of $1.4B in its development pipeline across Ontario, Alberta, British Columbia and Quebec.

Competitive imbalances

Modes of experience

The workplace ecosystem

Highlights by Census Metropolitan Area (CMA):

MASI Design Awards

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