July 12,2006: Toronto 2010 Part III: Office and Retail
Category: Toronto 2010
Posted by: maven
In Part III of Toronto 2010: The city in 3.5 years, we examine the changes that will occur in the and office and retail sectors.
The last major attempt at expanding the commercial/office sector of downtown Toronto failed with the 1989 crash of the real estate market. It was then, a prime piece of land located in the heart of the financial district at Bay and Adelaide was under construction for a major 50 story office tower. What remains on the land is a 12 story block of cement, the foundation of an elevator shaft which was all that was completed.
Eerily, the incomplete structure looks like a gigantic tombstone and for the longest time the site symbolized the Toronto commercial market, a graveyard. Many believed that Toronto could not sustain another major office tower, in other words, the commercial base had peaked. Some even called it a jinx, as several attempts in the late 90's to resurrect the project failed.
A few years ago Toronto finally got back to the same real estate prices of 1989. The residential market in Toronto has been healthy for a long while now, but it is only until recently that the commerical market has woken up from its nightmare.
In July 2006, The Toronto Star report that Toronto jumped from 48th to 32nd in most expensive office space cost in the world, only nine spots behind Manhattan, the most expensive of the North American cities.
After going over 15 years without any major office development, there is currently a race amongst four property management firms (Cadillac Fairview, Menkes, Brookfield, and Oxford) to be first to market since that time. We will look at these developments as well as Metropolis, a new retail addition being constructed by PenEquity in Dundas Square.
RBC Centre by Cadillac Fairview
For the time being, the RBC Dexia Centre by Cadillac Fairview appears to be leading the pack to be the first to deliver a new office tower in Toronto.
Cadillac Fairview were the first to secure an agreement with a major anchor tenant (RBC Dexia) which is key to the viability of constructing a new tower.
The RBC Dexia Centre will be be developed in tandem with the development of the Ritz Carlton (see Toronto 2010 Part 1: Hotels/Hospitality) located at Front and Simcoe, which sits next to RBC Dexia.
With these two key factors (a major anchor tenant, and multi-tasking of construction costs) RBC Dexia Centre at this momment has the highest probability of success and should be the first out of the gate.
Telus Centre by Menkes Development
The recently announced office development located across the Air Canada Centre (the home of the Toronto Maple Leafs and Toronto Raptors also has a lead tenant and a great chance of completion.
Telus Communications, a British Columbia based telecom firm will be the lead tenant in a 30 story tower developed by Menkes Development. Telus will occupy 60% of the tower, and will head quarter their operations in Toronto, consolidating their current staff force of 400.
Expected Occupancy is listed for 2009.
Bay Adelaide Centre by Brookfield Properties
The site of the Bay Adelaide Centre has a long history of failed attempts (i.e. suspect financing, no lead tenants, changing developers and an unconvincing office market). It's notoriety in Toronto has earned the site an entry in Wikipedia.
With the recent purchase of the land a few years back by property management giant Brookfield Properties, it appears that luck will soon change for the site.
The Bay Adelaide development in its current plan, is comprised of three office towers of approximately 50 stories, and is the largest of the new office developments and closest most central to the financial district in Toronto.
Brookfield hopes to begin demolish of the elevator shaft structure by the end of the summer, and also projects completion of their office tower by 2010.
Existing tenants in old buildings which are part of the planned site for demolish have vacated, and construction fences have gone up around the entire site. Progress has begun.
Richmond Adelaide Centre II by Oxford Properties
Quite under the radar in the office tower development race, is Richmond Adelaide Centre II.
Less information exists about the property which is owned by Oxford Properties. No official release has been made, however construction and demolition activity can be seen on the site located just around the corner from the Bay Adelaide Centre.
A few years back, plans which included renderings were made to build on top on an existing heritage building (see rendering) in order to expand the Richmond Adelaide Centre, and unconfirmed rumors are that Oxford is indeed building their tower.
Of the four mentioned office developments, Richmond Adelaide Centre II is the least likely.
Metropolis by PenEquity
Located at the north-east corner of Yonge and Dundas across from the Eaton Centre, is the PenEquity development site of a new shopping and entertainment complex called Metropolis.
Originally approved in 1998, and hampered by many delays, Metropolis is now well under way, and is quickly rising over Dundas Square, helping the Square to look it part. Metropolis will rise approximately 4 stories and will be clad almost entirely in billboard advertising, which will give Dundas Square very much the New York Times Square look and feel.
Metropolis will house a 24 screen AMC theatre, the Canadian Music Hall of Fame, several restaurants and new retail stores. Described as an urban entertainment centre, Metropolis will significantly add to the density of one of highest pedestrian traffic areas in Toronto (Yonge and Dundas).
Occupancy and billboard installation is listed as beginning in 2007.
Summary
With five new commercial buildings in varying stages of development, all of which are scheduled to be completed by 2010, Torontos commercial sector is set to dramatically awaken from it's 15 year dormancy. The sector was so pessimistic that many pundits thought Toronto would never again see a major office tower. Now, there is the prospective of four.
-Maven
The last major attempt at expanding the commercial/office sector of downtown Toronto failed with the 1989 crash of the real estate market. It was then, a prime piece of land located in the heart of the financial district at Bay and Adelaide was under construction for a major 50 story office tower. What remains on the land is a 12 story block of cement, the foundation of an elevator shaft which was all that was completed.
Eerily, the incomplete structure looks like a gigantic tombstone and for the longest time the site symbolized the Toronto commercial market, a graveyard. Many believed that Toronto could not sustain another major office tower, in other words, the commercial base had peaked. Some even called it a jinx, as several attempts in the late 90's to resurrect the project failed.
A few years ago Toronto finally got back to the same real estate prices of 1989. The residential market in Toronto has been healthy for a long while now, but it is only until recently that the commerical market has woken up from its nightmare.
In July 2006, The Toronto Star report that Toronto jumped from 48th to 32nd in most expensive office space cost in the world, only nine spots behind Manhattan, the most expensive of the North American cities.
After going over 15 years without any major office development, there is currently a race amongst four property management firms (Cadillac Fairview, Menkes, Brookfield, and Oxford) to be first to market since that time. We will look at these developments as well as Metropolis, a new retail addition being constructed by PenEquity in Dundas Square.
RBC Centre by Cadillac Fairview
For the time being, the RBC Dexia Centre by Cadillac Fairview appears to be leading the pack to be the first to deliver a new office tower in Toronto.Cadillac Fairview were the first to secure an agreement with a major anchor tenant (RBC Dexia) which is key to the viability of constructing a new tower.
The RBC Dexia Centre will be be developed in tandem with the development of the Ritz Carlton (see Toronto 2010 Part 1: Hotels/Hospitality) located at Front and Simcoe, which sits next to RBC Dexia.
With these two key factors (a major anchor tenant, and multi-tasking of construction costs) RBC Dexia Centre at this momment has the highest probability of success and should be the first out of the gate.
Telus Centre by Menkes Development
The recently announced office development located across the Air Canada Centre (the home of the Toronto Maple Leafs and Toronto Raptors also has a lead tenant and a great chance of completion. Telus Communications, a British Columbia based telecom firm will be the lead tenant in a 30 story tower developed by Menkes Development. Telus will occupy 60% of the tower, and will head quarter their operations in Toronto, consolidating their current staff force of 400.
Expected Occupancy is listed for 2009.
Bay Adelaide Centre by Brookfield Properties
The site of the Bay Adelaide Centre has a long history of failed attempts (i.e. suspect financing, no lead tenants, changing developers and an unconvincing office market). It's notoriety in Toronto has earned the site an entry in Wikipedia. With the recent purchase of the land a few years back by property management giant Brookfield Properties, it appears that luck will soon change for the site.
The Bay Adelaide development in its current plan, is comprised of three office towers of approximately 50 stories, and is the largest of the new office developments and closest most central to the financial district in Toronto.
Brookfield hopes to begin demolish of the elevator shaft structure by the end of the summer, and also projects completion of their office tower by 2010.
Existing tenants in old buildings which are part of the planned site for demolish have vacated, and construction fences have gone up around the entire site. Progress has begun.
Richmond Adelaide Centre II by Oxford Properties
Quite under the radar in the office tower development race, is Richmond Adelaide Centre II. Less information exists about the property which is owned by Oxford Properties. No official release has been made, however construction and demolition activity can be seen on the site located just around the corner from the Bay Adelaide Centre.
A few years back, plans which included renderings were made to build on top on an existing heritage building (see rendering) in order to expand the Richmond Adelaide Centre, and unconfirmed rumors are that Oxford is indeed building their tower.
Of the four mentioned office developments, Richmond Adelaide Centre II is the least likely.
Metropolis by PenEquity
Located at the north-east corner of Yonge and Dundas across from the Eaton Centre, is the PenEquity development site of a new shopping and entertainment complex called Metropolis.
Originally approved in 1998, and hampered by many delays, Metropolis is now well under way, and is quickly rising over Dundas Square, helping the Square to look it part. Metropolis will rise approximately 4 stories and will be clad almost entirely in billboard advertising, which will give Dundas Square very much the New York Times Square look and feel.
Metropolis will house a 24 screen AMC theatre, the Canadian Music Hall of Fame, several restaurants and new retail stores. Described as an urban entertainment centre, Metropolis will significantly add to the density of one of highest pedestrian traffic areas in Toronto (Yonge and Dundas).
Occupancy and billboard installation is listed as beginning in 2007.
Summary
With five new commercial buildings in varying stages of development, all of which are scheduled to be completed by 2010, Torontos commercial sector is set to dramatically awaken from it's 15 year dormancy. The sector was so pessimistic that many pundits thought Toronto would never again see a major office tower. Now, there is the prospective of four.
-Maven