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-   -   Canadian Office Space Market (http://forum.skyscraperpage.com/showthread.php?t=192174)

Spring2008 Oct 5, 2011 2:11 PM

Downtown Calgary's vacancy rate is only 6.4% as of q2 and dropping fast!! Class A sitting around 4% downtown, those are the only numbers that matter for those of us anticipating more office towers starting downtown in the near future.

Calgarian Oct 5, 2011 2:16 PM

Yeah there are lots office projects starting up, and it sounds like 2 possible high-rises already, and the Bow isn't even finished yet.

caltrane74 Oct 5, 2011 2:20 PM

Quote:

Originally Posted by Spring2008 (Post 5433961)
Downtown Calgary's vacancy rate is only 6.4% as of q2 and dropping fast!! Class A sitting around 4% downtown, those are the only numbers that matter for those of us anticipating more office towers starting downtown in the near future.

Did you want to provide a link to where you got that number, for those of us that like to rely on things other than "word of mouth"?

Spring2008 Oct 5, 2011 2:34 PM

^If u really want to see it google calgary q2 office market 2011....Really easy to find and the reports have been out for months now. Vacancy i would imagine is lower now.Going to work, could post tonight

LeftCoaster Oct 5, 2011 2:49 PM

Guys you need to keep in mind these numbers are all approximations.

CBRE will have a different number than Cushman who will have a different number than Colliers.

What is important are the trends not the asinine 4.6% Vs 5.2% arguments.

shreddog Oct 5, 2011 3:07 PM

Quote:

Originally Posted by LeftCoaster (Post 5434000)
...What is important are the trends not the asinine 4.6% Vs 5.2% arguments.

And don't forget rental rates :tup:

Spring2008 Oct 5, 2011 3:12 PM

http://www.calgaryherald.com/story_p...curriebarracks

The 6.4% vacancy rate downtown is actually the most recent figure from last month. It was 7.1% q2 2011. Q2 2011 class A vacancy was around 4.5% q2, prob even lower now. Find a link later for that.

Regardless Calgary has absorbed record amounts of office space these past 2 years, just a fact. Just awhile back people were mostly predicting 20% vacancy around this time.

LeftCoaster Oct 5, 2011 3:16 PM

Quote:

Originally Posted by shreddog (Post 5434021)
And don't forget rental rates :tup:

Rental rates, absorption, vacancy, tenants on the streets and many more are all vitally important, I'm just trying to say the minute details are not what is important. Every brokerage has their own metrics and definitions that make minutiae a waste of time.

The important thing is the overall picture and the trends.

Luckily for Canadians almost every market in the country is looking quite healthy.

WhipperSnapper Oct 5, 2011 10:13 PM

Quote:

Originally Posted by Spring2008 (Post 5434025)
http://www.calgaryherald.com/story_p...curriebarracks

The 6.4% vacancy rate downtown is actually the most recent figure from last month. It was 7.1% q2 2011. Q2 2011 class A vacancy was around 4.5% q2, prob even lower now. Find a link later for that.

Regardless Calgary has absorbed record amounts of office space these past 2 years, just a fact. Just awhile back people were mostly predicting 20% vacancy around this time.

I was one that assumed 20% was a more likely outcome for the Calgary market. However, I also couldn't imagine Vancouver, Montreal and Toronto experiencing the booms in new construction that they are. You win some and you lose some. One thing that I'm wary about is the amount of vacant space that has been pulled from the market to upgrade, as a reserve, etc. The space being upgraded will eventually be back on the market and another dip in the economic could send sublet space beck into the stratosphere.

Doug Oct 6, 2011 5:53 PM

Oxford Properties plans 25-storey tower for Calgary’s Eau Claire area


Class A office vacancy downtown dropped to 4.5 per cent in the third quarter of this year, from 12.5 per cent in the third quarter of 2010, according to commercial real estate firm CB Richard Ellis Ltd.


http://www.calgaryherald.com/busines...#ixzz1a1d5mQtf

freeweed Oct 6, 2011 6:31 PM

Quote:

Originally Posted by LeftCoaster (Post 5434000)
What is important are the trends not the asinine 4.6% Vs 5.2% arguments.

Some of the arguments are 10% vs 6%... that's a bit more of a meaningful difference. Like nearly double.

Either way, expect a flurry of announcements over the next 3-6 months in Calgary. I can't speak for other markets as I don't follow them closely.

TallBob Oct 7, 2011 4:22 AM

Now if the Shadow nazis would just go away....

craner Oct 9, 2011 6:12 AM

God - we don't need another 25 storey tower - double that at least as a starting point.
:superwhip

TallBob Oct 9, 2011 7:04 AM

Ya and Centennial III is a dog as far as I'm concerned. That is an area that has strict "shadowing" restrictions.

Wooster Oct 9, 2011 8:15 PM

I don't think shadows had anything to do with Oxford developing at 25 storeys in this location - based on what's next door (Centennial I and II) they could likely have had at least 40 floors at this location and fall within shadowing rules.

I think Centennial III is a handsome design.




WhipperSnapper Oct 10, 2011 1:14 AM

Quote:

Originally Posted by TallBob (Post 5438449)
Ya and Centennial III is a dog as far as I'm concerned. That is an area that has strict "shadowing" restrictions.

I don't share your sentiments. It's clean and simple and a huge leap forward on phases 1 and 2.

TallBob Oct 10, 2011 4:28 AM

Wooster: I didn't realize they could go much higher in that spot. 40 floors would have been nice.

Coldrsx Oct 10, 2011 9:29 PM

Going to be a beast though at 615k and only that height.

Wooster Oct 11, 2011 12:01 AM

24,500 sq ft floor plates is pretty standard for a CBD. It's just short.

Spring2008 Oct 23, 2011 6:58 PM

Calgary downtown vacancy now at 5.01%, A class vacancy at 3.78%, AA at 1.89%. Crazy to think Calgary has absorbed about 4millions sq feet of A/AA class office space downtown since Q4 2009 during the recession.........


http://www.cresapartners.com/calgary...t-downtown.pdf

Calgarian Oct 24, 2011 2:06 PM

Quote:

Originally Posted by TallBob (Post 5436418)
Now if the Shadow nazis would just go away....



No way! keep the shadow restrictions. Building a good quality city is much more important than a giant penis of a building.

Lets face it, Calgary is pretty damn cool most of the year, the saving grace is the fact that it's usually sunny. I was out yesterday and in the shade it was probably 10 degrees colder than in the sun, and when it's only 12 degrees outside, that can make the difference whether you go outside or not.

Either way, looking forward to a boom that should bring about some more density and better quality development.

Surrealplaces Oct 25, 2011 3:43 PM

Quote:

Originally Posted by LeftCoaster (Post 5434000)
Guys you need to keep in mind these numbers are all approximations.

CBRE will have a different number than Cushman who will have a different number than Colliers.

What is important are the trends not the asinine 4.6% Vs 5.2% arguments.

Bingo. An office market can sit at 3 or 4% vacancy, but if there isn't a trend showing it dropping, don't expect any new office construction.

Surrealplaces Oct 25, 2011 3:49 PM

Quote:

Originally Posted by Coldrsx (Post 5439842)
Going to be a beast though at 615k and only that height.

Should end up being wider than the first Centennial phases, but not too bad I don't think. Centennial I is 40 floors, but with ~800k of space, and it's floor plate is not very big.

I'm a fan of Centennial III. Not very tall, but a nice solid building, and a good fit for that location.

caltrane74 Oct 25, 2011 3:54 PM

It reminds me of the new Royal Bank Global Headquarters down at the harbourfront, which is starting construction next month...

Silent_Bob Oct 25, 2011 5:10 PM

Quote:

Originally Posted by Surrealplaces (Post 5455946)
Bingo. An office market can sit at 3 or 4% vacancy, but if there isn't a trend showing it dropping, don't expect any new office construction.

Also, it makes a difference on the relative size of the existing market. A 2 or 3% drop in the vacancy rate of say a city like Regina isn't a alot of space in terms of raw numbers. A 3% drop in Calgary represents another Million sq feet - essentially 50 storey building worth of space.

caltrane74 Oct 25, 2011 7:31 PM

Some potential new office space could come online next to the new RBC Global Headquarters building to be built down by the lake.

31 Floors seems to be the going size for new office towers in Toronto. - Nobody wants to build 50 or 60 floor office towers anymore. Wonder why?????


Quote:

90 HARBOUR ST

OPA / Rezoning 11 295626 STE 28 OZ Ward 28
- Tor & E.York Oct 19, 2011 --- --- --- ---

PROPERTY KNOWN AS BOTH 90 Harbour and 1 York St. OPA and Rezoning application for new mixed use development - 3 buildings - with common poidium ranging from 4 to 9 stories. 1 office building and 2 residential buildings Office building - 31 stories. 2 residential buildings - 70 stories - 1426 dwelling units. Shared parking with office and residential tower - 4 levels below grade - 791 parking spaces - (residential parkings spaces 411 - Commercial spaces - 380). 1300 bicycle parking spaces.

Cowtown_Tim Oct 25, 2011 10:21 PM

^they may be cutting down on the height of office towers, but not residential towers from the looks of it - 2 more 70 storey res towers!. Toronto is overtaking Chicago in terms of skyline size and density if it hasn't already.

TallBob Oct 26, 2011 4:24 AM

Coldrsx: Yep, another "Fat Boy"! (Regarding Centenial III)

davidivivid Oct 27, 2011 6:58 PM

Between 2009 and 2012, 1.85 million sq ft of office space was built in Quebec City, the same amount as in Montreal, even though the Quebec market is about 5 time smaller than Montreal's. Despite this surge in construction, Quebec's vacancy rate remains low, at 4,8%. Hence, it is estimated that during the next two years, 1.1 million sq ft of additional office space will be made available in Quebec City (investments worth about $370M).

source: Altus InSite

http://www.lesaffaires.com/archives/...ontreal/536798

Rico Rommheim Oct 27, 2011 7:49 PM

Quote:

Originally Posted by davidivivid (Post 5458877)
Between 2009 and 2012, 1.85 million sq ft of office space was built in Quebec City, the same amount as in Montreal, even though the Quebec market is about 5 time smaller than Montreal's. Despite this surge in construction, Quebec's vacancy rate remains low, at 4,8%. Hence, it is estimated that during the next two years, 1.1 million sq ft of additional office space will be made available in Quebec City (investments worth about $370M).

source: Altus InSite

http://www.lesaffaires.com/archives/...ontreal/536798

That's cool, but the problem for building nuts like us is that none of that translated into any significant towers in either Quebec or Montreal!

Calgarian Oct 27, 2011 10:03 PM

According to CBRE as quoted by CBC, Calgary's vacancy rate is 7% currently and dropping fast. Crazy considering how much office space was build here in the last 10 years.
http://www.cbc.ca/news/canada/calgar.../calgary-.html

Cowtown_Tim Oct 28, 2011 2:56 AM

Quote:

Originally Posted by Calgarian (Post 5459102)
According to CBRE as quoted by CBC, Calgary's vacancy rate is 7% currently and dropping fast. Crazy considering how much office space was build here in the last 10 years.
http://www.cbc.ca/news/canada/calgar.../calgary-.html

and that's all classes of space in the core. AA is something like 3%. Amazing.

craner Oct 28, 2011 5:46 AM

Centenial III
 
Quote:

Originally Posted by Coldrsx (Post 5439842)
Going to be a beast though at 615k and only that height.

Yeah this is the type of thing I hate to see. I don't mind the aesthetic of the design but this pudgy beast is going to eat up all that retable space and not provide any height thereby potentially delaying construction of a tall tower. :hell:

Great news regarding the office vacancy rates accross the country though.

TallBob Oct 28, 2011 5:58 AM

Like Livingston Place, Centenial III is something you'd see in a large American cities' suburb. If the city is is so concerned about "shadowing", they should ban developement altogether in these areas. Too many short and wide buildings DT.

sync Oct 28, 2011 6:27 AM

Quote:

Originally Posted by TallBob (Post 5459559)
Like Livingston Place, Centenial III is something you'd see in a large American cities' suburb. If the city is is so concerned about "shadowing", they should ban developement altogether in these areas. Too many short and wide buildings DT.

density > *

Metro-One Oct 29, 2011 10:14 PM

On the Vancouver forum all the current office proposals in Vancouver proper have been calculated at an addition of over 4 million square feet of office space to be added (and for the most part these are all very solid proposals, some already u/c and / or at the site prep stage.

Not bad for Vancouver (and there are a few other proposals where the footage is not yet known)

Wooster Oct 29, 2011 10:22 PM

Quote:

Originally Posted by TallBob (Post 5459559)
Like Livingston Place, Centenial III is something you'd see in a large American cities' suburb. If the city is is so concerned about "shadowing", they should ban developement altogether in these areas. Too many short and wide buildings DT.

I don't know how many times this needs to be stated - the height of Centennial III has nothing to do with shadow restrictions. Right across the street to the east there as a 40 storey 540 ft building (Centennial I). Centennial III could also have easily been in the 40 storey range, but the developer chose not to build it. Not every building needs to max out their potential height.

The most important thing is the quality of design and contribution to the urban fabric - Centennial III is extremely solid in this regard. Besides it's not that "fat" a building - a floor plate of around 24,000 sq ft is not that large really - very average.

Habanero Oct 29, 2011 10:36 PM

Quote:

Originally Posted by Wooster (Post 5461260)
I don't know how many times this needs to be stated - the height of Centennial III has nothing to do with shadow restrictions. Right across the street to the east there as a 40 storey 540 ft building (Centennial I). Centennial III could also have easily been in the 40 storey range, but the developer chose not to build it. Not every building needs to max out their potential height.

The most important thing is the quality of design and contribution to the urban fabric - Centennial III is extremely solid in this regard. Besides it's not that "fat" a building - a floor plate of around 24,000 sq ft is not that large really - very average.

Agreed. It's not much bigger floorplate than Centenial II which is quite slender.

Doug Nov 1, 2011 2:38 AM

http://www.theglobeandmail.com/repor...rticle2220254/


Move over, Toronto – there’s a new hotspot in town
shelley white
Special to Globe and Mail Update
Published Monday, Oct. 31, 2011 4:54PM EDT
Last updated Monday, Oct. 31, 2011 7:43PM EDT


Sky-high rents. Heavy demand for downtown office space. A magnet for company headquarters. It may sound like Toronto, but this commercial real estate hotspot is decidedly farther west.

Despite erratic markets and a lingering world recession, Calgary's office and commercial real estate market rivals Toronto as the most robust in the country, driven predominantly by the continued growth plans of energy companies.

“We've got a vibrant downtown core, a strong commodity-based economy, low tax rates in Alberta and [many] corporate head offices in Calgary, most of those tied to the energy sector. Calgary is a dynamic place to be right now,” says Joe Binfet, managing director of Colliers International in Calgary.

Indeed, the Toronto Board of Trade's 2011 Scorecard on Prosperity, which compares 24 of the world's most prosperous urban centres, gave Calgary third place, just below Paris and San Francisco. Toronto came in eighth.

freeweed Nov 1, 2011 4:13 AM

Dynamic, eh? :D

These articles are only news to the Toronto media. What's weird is I'd swear they were printing the exact same stories in 2007. Guess they assumed the recession hit everyone equally and that Calgary emptied out or something.

Ramako Nov 1, 2011 4:56 AM

I keep hearing about all the demand for office space in Calgary, but I haven't seen any recent activity aside from finishing off the Bow. Is anything breaking ground soon?

caltrane74 Nov 1, 2011 9:27 AM

There is that Tower from a couple pages back, Centinnial Place 3, looks like a clone of the new Royal Bank Global Headquaters which starts in Toronto next month. Seems like all new office towers will now be 30 storey fat boxes.

LeftCoaster Nov 1, 2011 1:55 PM

Calgary City Centre, EAP 2 and Herald Square all have some traction as well.

One or two of the aforementioned projects will be starting within 12 months. Almost for sure EAP and likely City Centre although Herald Square has a decent shot too.

And I don't think the Calgary office market is news to anyone but the most uninformed anymore. Even your regular joe on the street in Toronto knows what's going on out west.

Doug Nov 1, 2011 2:07 PM

Perhaps some insight into the demand in Calgary...

Is Calgary stealing Bay Street's thunder in mergers?
http://www.theglobeandmail.com/globe...rticle2220747/


Ontario, Quebec losing market share in mergers
boyd erman
Globe and Mail Blog
Posted on Tuesday, November 1, 2011 7:12AM EDT

Investment banking was once largely the preserve of folks in shiny towers in Toronto and Montreal.

Now, Calgary is probably the most heavily bankered city in the country, and firms are branching out and bankers are showing up in smaller centres across Canada. There are offices in towns like Saskatoon (MGI Securities) and Winnipeg (CIBC World Markets.) A report looking at merger activity by province helps to explain why.

The PricewaterhouseCoopers report shows that while companies in Ontario and Quebec once represented two-thirds of the merger and acquisitions activity in Canada, when looking at where the target is based, the two provinces are now down to about half. Ontario dropped from 47 per cent to 31 per cent in the past decade, and Quebec slipped from 29 per cent to 22 per cent.

Much of that market share went to Alberta. But most areas of Canada gained.

While M&A share in Manitoba is down, Winnipeg is once again seen as a "gateway to the west," for large financial firms looking for business. Saskatchewan is busier because it has uranium, potash and farm land that are coveted, the report says. The Atlantic provinces are also increasingly popular.

However, nobody will be abandoning Toronto any time soon. While Ontario has lost some market share on the sell side, it has boomed on the buy side. Buyers from Ontario make up 70 per cent of acquisitions with a Canadian buyer this year, according to PWC.

Here's a look M&A at market share by province of the company being sold, comparing 2011 and 2000. The analysis is by dollar value of deals.
•Alberta: Up from 17.1 per cent to 25.7 per cent.
•British Columbia: up from 5 per cent to 16 per cent.
•Manitoba: Down from 1.5 per cent to 1.1 per cent
•Ontario: Down from 47 per cent to 31.4 per cent
•Quebec: Down from 29.1 per cent to 22 per cent
•Saskatchewan: up from 0.1 per cent to 2 per cent
•Atlantic provinces: up from 0.1 per cent to 1.2 per cent

LeftCoaster Nov 1, 2011 2:15 PM

Despite where the M&A companies are HQed, nearly every M&A transaction in Canada worth caring about still occurs in Toronto boardrooms.

caltrane74 Nov 1, 2011 2:24 PM

Quote:

Originally Posted by Doug (Post 5463693)
However, nobody will be abandoning Toronto any time soon. While Ontario has lost some market share on the sell side, it has boomed on the buy side. Buyers from Ontario make up 70 per cent of acquisitions with a Canadian buyer this year, according to PWC.

Finally a category where Ontario punches above our weightclass!!!

freeweed Nov 1, 2011 4:40 PM

Quote:

Originally Posted by Ramako (Post 5463480)
I keep hearing about all the demand for office space in Calgary, but I haven't seen any recent activity aside from finishing off the Bow. Is anything breaking ground soon?

Yes and no, as others have mentioned. Calgary's real estate market is insanely boom-or-bust - we saw this last time too. We dropped to pretty much a zero vacancy rate, then suddenly everyone was out building for a few years. Then pretty much nothing, and I suspect we'll be close to bottoming out again on the vacancy rate before we see much activity. Then BAM! 5-10 new towers all underway at once.

It's a very strange way of capacity planning, but it's just what we're used to.

Calgarian Nov 1, 2011 6:24 PM

I wouldn't be surprised if there are a few large towers already in the works...

craneSpotter Nov 1, 2011 6:29 PM

Quote:

Originally Posted by LeftCoaster (Post 5463700)
Despite where the M&A companies are HQed, nearly every M&A transaction in Canada worth caring about still occurs in Toronto boardrooms.

Very true.

Coldrsx Nov 1, 2011 6:43 PM

Quote:

Originally Posted by freeweed (Post 5463831)
Yes and no, as others have mentioned. Calgary's real estate market is insanely boom-or-bust - we saw this last time too. We dropped to pretty much a zero vacancy rate, then suddenly everyone was out building for a few years. Then pretty much nothing, and I suspect we'll be close to bottoming out again on the vacancy rate before we see much activity. Then BAM! 5-10 new towers all underway at once.

It's a very strange way of capacity planning, but it's just what we're used to.

And a terrible way to do things, let along what it does to the rest of the Province in terms of capacity, labour, pricing, and material availability... but it is forever tied to the O&G industry and that's how they roll.


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